Preamble

The House met at half-past Two o'clock

PRAYERS

[MR. SPEAKER in the Chair]

PRIVATE BUSINESS

NOTTINGHAMSHIRE COUNTY COUNCIL BILL [Lords] (By Order)

Order for further consideration, as amended, read.

Clause 6

NOTICE OF STREET PROCESSIONS

Amendment proposed [19 January], No. 1, in page 7, line 3, leave out clause 6.—[Ms. Harman.]

Question put. That the amendment be made:

Hon. Members: Object.

To be further considered upon Thursday.

Oral Answers to Questions — EMPLOYMENT

Labour Statistics

Mr. Dixon: asked the Secretary of State for Employment how many more people than in June 1979 were recorded at the most recent date available as having been unemployed for more than a year.

The Minister of State, Department of Employment (Mr. John Selwyn Gummer): About 850,000.

Mr. Dixon: Is the Minister aware that, of those 850,000 people, 90,639 are in the northern region? May I suggest that the Minister and the Cabinet do the same as the hon. Member for Derbyshire, West (Mr. Parris)—go to Newcastle and spend a week on unemployment benefit? They may then have some compassion for those who are out of work because of the Government's policies.

Mr. Gummer: It is a question of making people sufficiently compassionate to do something about the issue, and that is what the Government are doing. Previous Governments did nothing about the underlying problem of the British economy, and that has resulted in this tragic state of affairs.

Dr. David Clark: Does the Minister realise that 600 employees of Plessey in my constituency will soon be added to that appalling figure and that the Secretary of State for Trade and Industry has refused to meet representatives of the local community? If the hon. Gentleman is keen to assist areas such as Tyneside, will he consult his colleagues in the Department of Trade and Industry about setting up a joint initiative to try to enable some modern technological jobs to stay on Tyneside?

Mr. Gummer: I am happy to draw those remarks to my right hon. Friend's attention.

Mr. John Smith: The Minister referred to what might be done about these matters. I suggest that one obvious measure to help our unfortunately large army of long-term unemployed is to extend long-term supplementary benefit to them. That would have the effect of giving a family £11 and a single person £7 a week more. As we unfortunately have such a large number of long-term unemployed, is it not high time that we sought to afford them some social justice?

Mr. Gummer: I am sure that the right hon. Gentleman will agree that that is a matter for my right hon. Friend the Secretary of State for Social Services.

Youth Training Scheme

Mr. Latham: asked the Secretary of State for Employment whether he will make a statement on the possible reallocation of unspent cash resources under the youth training scheme.

The Minister of State, Department of Employment (Mr. Peter Morrison): While we do not propose any general reallocation of the potential underspend on the youth training scheme, I am proposing to transfer, subject to parliamentary approval, £25 million from the Manpower Services Commission's grant-in-aid to the community programme to allow the original target of 130,000 filled places to be met by the end of the financial year.

Mr. Latham: Is my hon. Friend aware that although the statement made in the House on 21 December 1983 was welcome so far as it went, some of us would have preferred to see the Manpower Services Commission's proposals for 17-year-olds accepted and the figure of £4 reduced to below £3? If money is still left at the end of this financial year, will he consider reallocating it?

Mr. Morrison: I assure my hon. Friend that we looked carefully at the proposals for 17-year-olds. We thought that it was right that the year ahead should be one of consolidation for the youth training scheme. I am grateful to my hon. Friend for his remarks about the £3 limit on the travelling allowance. We shall keep that matter under review. We await further thoughts from the MSC.

Mr. Meadowcroft: Will the Minister look carefully at the recent statement that appeared to be derogatory of the many excellent schemes, similar to the YTS, carried out by the voluntary sector and consider allocating some of the unspent resources to encourage schemes in that sector?

Mr. Morrison: I assure the hon. Gentleman that nothing derogatory was said about the voluntary organisations. They have fulfilled and will continue to fulfil an important task in relation to the YTS. We have always maintained that employer-based schemes are to be in the majority in terms of the totality of the YTS.

Mr. Lawler: As there are vacancies in a number of schemes, especially ITEC schemes, due to the successful placing of trainees in full-time employment before the end of the scheme, will my hon. Friend consider allowing careers officers to place 18-year-olds in those vacancies?

Mr. Morrison: I cannot give my hon. Friend that assurance, but if a trainee moves from trainee to employed status he can still be part of the youth training scheme.

Ms. Clare Short: Has the Minister read the report of the West Midlands National Association of Teachers in Further and Higher Education showing that in Birmingham private agencies are monopolising the scheme and running it for profit? Will he use some of the resources saved, due to the lack of enthusiasm for the scheme among young people, to run the scheme better rather than divert the funds to other purposes?

Mr. Morrison: I know that the hon. Lady has never much liked the scheme, but I am surprised at her claim that young people do not like it, as more than 300,000 have already joined it on a voluntary basis. I have not seen the report to which she refers, but private managing agencies are acceptable, as are voluntary organisations and local authorities.

Mr. Michael Morris: I congratulate my hon. Friend on the general success of the scheme, but, as there is still criticism of the complications of running it, will he try to remove those difficulties before transferring resources elsewhere?

Mr. Morrison: I am always prepared to listen to constructive ideas for simplifying the bureaucracy of the scheme. We wish to ensure, both this year and next, that the quality of the training is improved wherever possible.

Mr. Sheerman: Is the Minister concerned about the number of youngsters placed with training rather than with trading companies? Is he aware that in some areas more than 40 per cent. of youngsters are placed with training companies and not, as was the original intention of the scheme, with companies actually making a product for sale?

Mr. Morrison: As the hon. Gentleman knows, the agencies concerned use their training facilities for 13 weeks, or perhaps longer, and then farm the trainees out to acquire work experience on employers' premises.

Mr. Forth: Will my hon. Friend consider relaxing the rules for disabled youngsters who often cannot meet the rigorous age limitation requirements so that they may find employment, which otherwise might not be possible?

Mr. Morrison: I agree that disabled youngsters have an especially powerful case. That is why my right hon. Friend the Secretary of State announced before Christmas that the eligibility rules would allow such youngsters to enter the scheme up to the age of 21.

Jobcentres (Cambridge)

Mr. Freud: asked the Secretary of State for Employment how many staff were employed in jobcentres in Cambridgeshire (a) at the latest date and (b) in June 1979; and if he will make a statement.

The Under-Secretary of State for Employment (Mr. Alan Clark): The numbers of staff employed were as follows: 1 January 1984, 70; 1 June 1979, 86.

Mr. Freud: I realise that the fall in numbers employed relates to the clientele which has been lost, but will the Minister consider giving my constituents more incentive to go to jobcentres by creating more employment, especially for unskilled workers?

Mr. Clark: I am surprised at the hon. Gentleman's reference to a fall in clientele. If the jobcentres in his area

are anything like those which I have visited throughout the country, vacancies are never less than 40 per cent. higher than, and usually double, what they were at this time last year.

Mr. Skinner: rose—

Mr. Speaker: I trust that the hon. Gentleman's question relates to Cambridgeshire.

Mr. Skinner: Yes, Mr. Speaker.
During his tour of the jobcentres in Cambridgeshire, did the Minister carry out a survey of the number of people able to say what the initials of the trade union GMBATU stand for? As he could not tell the Standing Committee this morning, will he tell us now that I have given him another chance?

Mr. Clark: It is not really within my responsibility to conduct such a survey.

Mr. Skinner: I will give the Minister a clue — "General".

Mr. Clark: Naturally, I am delighted that the hon. Gentleman follows the proceedings upstairs so closely.

Dock Labour

Mr. John Townend: asked the Secretary of State for Employment if he will assess the performance of the dock labour scheme ports as compared with non-scheme ports in terms of capacity to handle traffic, cost-effectiveness of operation, and actual employment of workers, with a view to amending the Dock Work Regulation Act 1976.

Mr. Gummer: Comparisons between ports have to take into account many things. It is not possible to isolate any one factor. There is, however, no doubt that the operation of the dock labour scheme is increasingly being questioned by those concerned in the industry.

Mr. Townend: I welcome my hon. Friend's remarks, but is he aware that only two groups of people have jobs that are guaranteed for life? They are university professors and dockers working under the dock labour scheme. Is that not one of the reasons why ports, such as Hull, have been losing their competitive position against Felixstowe and private wharfs? As the Government believe in a free labour market, is it not time that they grasped the nettle and abolished the scheme lock, stock and barrel?

Mr. Gummer: It is not for me to comment on the excellent port of Felixstowe, but I agree with my hon. Friend. I also agree with the comment of Lord McCarthy, in another place, that the Act was misconceived.

Mr. McNamara: The Act gave dignity, honour and job security for the first time to underprivileged workers in one of the most casual industries that had ever existed in this country. It enabled men in the docks to hold their heads up for the first time without having to fight and scramble for the favour of half a day's work and giving the employer a backhander in the pub after the job was done. We do not want to return to such a situation. We need more schemes, such as the dock labour scheme, to protect workers.

Mr. Gummer: The hon. Gentleman rightly reminds us that the situation in 1946 was very different from what it is today. However, the dock labour scheme is not working as it was intended to work. It does not benefit either


registered dock workers or the rest of the dock services. The industry must make sure that the public and those who benefit from the docks see that the scheme is working effectively. At the moment, that is not clear to them.

Mr. Hill: Competition between scheme and non-scheme ports is totally unfair. The Jones-Aldington agreement was intended to last for a certain period. Is it not time for a thorough review of the dock labour scheme? Could not a separate unbiased body be set up to discuss all the points for and against the scheme, the effects of which can be draconian in certain ports?

Mr. Gummer: If the dock labour scheme is to provide the benefits to which the hon. Member for Kingston upon Hull, North (Mr. McNamara) referred, it must be seen to provide those benefits. It often appears to operate in the narrow interests of a certain section of those who work in the docks.

Mr. Loyden: Will the Minister resist the suggestion of his hon. Friend the Member for Bridlngton (Mr. Townend) that he should interfere with the dock labour scheme? The scheme ports and the non-scheme ports have coexisted for a considerable time. Any attempt by the Government to interfere with the scheme could unite dock workers against the Government in a way that has not been seen for many years.

Mr. Gummer: Such comments would be taken more seriously by the House if the British docks had enjoyed a more remarkable resurgence in the past 25 years. The docks industry would do well to heed my advice, that it must be seen to make the scheme work. If not, people will pay more attention to the way in which it benefits only a small group of workers.

Mr. Rowe: I and hon. Members representing neighbouring constituencies have been lobbied by dockers from the Medway towns who fear that the operation of the dock labour scheme will ensure that jobs that should go to them will go to other dockers. If that is how the scheme works, will my hon. Friend do something about it?

Mr. Gummer: My hon. Friend points again to the fact that many people question the dock labour scheme because they believe that it leads to fewer rather than more jobs. I have said that it is up to the industry, and those who support the dock labour scheme, to show that it works. The example given by my hon. Friend is one that I shall be studying most carefully.

Labour Statistics

Mr. Dormand: asked the Secretary of State for Employment what proposals he now has for reducing unemployment.

The Secretary of State for Employment (Mr. Tom King): The Government's economic strategy is directed at creating the conditions in which industry can improve its competitiveness and so generate real, lasting jobs. In addition, we are continuing to promote a number of special employment and training measures.

Mr. Dormand: Is the Secretary of State aware that, despite what he has just said and the repetition that we hear about the recovery, unemployment in the northern region is still rising and remains at the highest rate in the United Kingdom outside Northern Ireland? In addition to what my

hon. Friend the Member for Jarrow (Mr. Dixon) said, may I ask the right hon. Gentleman to persuade the Prime Minister to come to the north east and stay for a week on supplementary benefit, as experienced by the hon. Member for Derbyshire, West (Mr. Parris)? Will the right hon. Gentleman remind the Prime Minister that people there remain unemployed for months and years with little or no hope for the future? What will he do about that?

Mr. King: I referred in my answer to the special employment and training measures that we are taking. Undoubtedly unemployment is extremely serious, and every hon. Member who knows anything about the north east knows the problems that it faces. I notice that in Peterlee and Wearside— areas of interest to the hon. Gentleman—8,000 people were placed in jobs last year; that in the Durham area there were 5,700 entrants into the youth training scheme; and that in Durham and south Tyne there are 6,500 people currently on the community programme. It can be seen that part of the substantial expenditure of nearly £2 billion that the Government are putting into training and special employment measures is helping to allieviate a difficult position in the north east.

Mr. Stokes: Does my right hon. Friend agree that management and trade union leaders have a responsibility to see that wage rises are contained if unemployment is to be reduced? Is he not disturbed in that regard by the latest figures produced by the CBI yesterday?

Mr. King: I am anxious that we should recognise the importance of keeping inflation down and ensuring that British industry remains competitive. I am encouraged to see that in the latest survey by "Manpower", the 1,260 leading employers in this country now say that
the first three months of 1984 will be more favourable for job prospects than any comparable first quarter of the year during the past four years.
Those are encouraging signs of the gains that can be made. It is important to ensure moderation in wage bargaining.

Mr. Strang: Has the Secretary of State estimated the financial cost to the Government which would arise from the additional unemployed resulting from any closure of Scott Lithgow?

Mr. King: We face some extremely serious consequences in a number of industries which are uncompetitive at present. We are not isolated. The hon. Gentleman will have seen in The Times today that the Socialist Government of France are forecasting privately that over the next three years 500,000 jobs will go in coal, steel, the shipyards and the car industry. Therefore, we must be realistic about the problems that we face.
We now see better employment prospects. For the first time for four years the figures for the last quarter show an increase in the number of jobs in this country and possibilities of people being in work. That is an important development.

Mr. Kenneth Carlisle: Does my right hon. Friend accept that it is an outdated fallacy to believe that any Government can create jobs out of the blue? In reality, jobs are made by producing a product or providing a service that someone wants to buy.

Mr. King: The feature of the past four years is that, while there has been a considerable growth of jobs in service industries, there has been a greater loss of jobs in manufacturing. The latest figures available to me show


that the erosion of jobs in manufacturing has now stopped. It looks as though there will be 250,000 new jobs in service industries this year and that during the last quarter there may be a small net gain in manufacturing jobs.

Mr. Wrigglesworth: What the Secretary of State has just described will make hardly a dent in the unemployment figures. Will the right hon. Gentleman study what is happening in other countries, such as France and the United States, where increasing demand within the economy has brought about 18 per cent. growth in industrial output during the last quarter? Will the Government reconsider their economic policy and stimulate demand to get people back to work again?

Mr. King: The hon. Gentleman was not listening to my first reply. I do not believe that that will have any impact on unemployment. If, as my hon. Friend the Member for Halesowen and Stourbridge (Mr. Stokes) said, we show sense by wage moderation and by remaining competitive, that will have a great impact on unemployment.

Mr. Cormack: Does my right hon. Friend accept that our right hon. Friend the Chancellor of the Exchequer could make a significant move forward on 13 March by abolishing the national insurance surcharge? Will he urge his right hon. Friend to do that?

Mr. King: I shall not anticipate measures that may be introduced by my right hon. Friend the Chancellor of the Exchequer. However, it is necessary for the encouraging recovery to continue. A survey among all the members of the Institute of Directors shows that there are now more encouraging prospects for its members. That must not be put at risk by increasing public expenditure, or the public deficit, which could seriously damage interest rates.

Mr. John Evans: Will the Secretary of State confirm that the spiralling decline in this country's manufacturing industry over the past four years has been deliberately created by the Government's activities, especially in areas such as the north west and Merseyside? On Friday night, a further large group of redundancies was announced by BICC. Will the right hon. Gentleman tell the House whether he expects employment in manufacturing industry to rise over the next two years?

Mr. King: If the hon. Gentleman is suggesting that that has been a deliberate policy, perhaps he will also suggest that the Socialist Government of France have adopted a deliberate policy to lose 500,000 jobs in the next three years. That is the reality that modern industrialised countries have to face in the very painful period of transition to the use of new technology.

Adult Retraining

Mr. Gerald Bowden: asked the Secretary of State for Employment if he is satisfied with current provision for adult retraining; and if he will make a statement.

Mr. Alan Clark: My right hon. Friend is currently considering proposals put to him by the Manpower Services Commission for a more effective strategy for adult training and retraining.

Mr. Bowden: I thank my hon. Friend for his reply. Will he take into account the views of the Association of Polytechnic Teachers, which advocates access for the

mature student to institutions of higher education and polytechnics in order to retrain for professional employment?

Mr. Clark: Many interests were taken into account, including those of the teaching profession, during the preparation of the report.

Mr. Dubs: Does the Minister agree that there is an urgent need to increase the amount of training in new technology for employed and unemployed adults? Will he use some of the large underspend on YTS for that purpose?

Mr. Clark: There is much in what the hon. Gentleman says. In 1983–84 it is planned to provide about 6,300 places under the training opportunities scheme in new technology and computing skills.

Mr. Penhaligon: Will the Minister state how many people are currently in adult retraining and what that represents as a percentage of the male unemployed?

Hon. Members: Answer.

Mr. Clark: I shall have to write to the hon. Gentleman with that answer.

Mr. Sheerman: Does not the Minister's hesitancy in answering that question underline the fact that the forgotten generation of those between 17 and 25, for whom the Government have no policy for training or retraining, are the people, in their hundreds and thousands, to whom the Government offer no hope and no future?

Mr. Clark: I reject what the hon. Gentleman says. As he well knows, the training schemes implemented and programmed by the Government are larger than those of any of our predecessors.

Industrial Stoppages

Mr. Lewis Stevens: asked the Secretary of State for Employment if he will make a statement on the trends in industrial stoppages in British industry.

Mr. Tom King: There has been a significant fall in the past four years in the number of stoppages and the amount of working days lost.

Mr. Stevens: I am grateful to my right hon. Friend for that reply. Does he accept that that fall reflects well on the Government, management and trade unions? Does he agree that there is no room for complacency? Will he ensure that active encouragement is given to those involved, including employers' organisations, to develop worthwhile long-term industrial relations?

Mr. King: I am able to report a significant reduction to the House. It is noteworthy that the figures for this year so far are running at about one quarter of the average figure of 12 million days lost every year between 1971 and 1980. Although the figure is now down to over 3 million days, it still does enormous damage to this country's performance when compared with some of our competitors, some of which have almost a nil entry in that respect. It is vital that we do not lose days through industrial disputes, because the only real loser is this country's economic performance.

Mr. Park: Is not the trend a reflection of the rising tide of unemployment, which engenders fear among working people because they know that if they lose the job that they have they have no chance of getting another?

Mr. King: It also reflects the fact that people increasingly appreciate that, in a very competitive world, if a firm goes on strike and there are unnecessary stoppages the orders will be delivered late, if at all, and the customers will be lost. The truth is that if we had kept our own share of our markets over the past 10 years, there would be 1·5 million more jobs in this country. There is no question but that our record on industrial disputes had a lot to do with greater import penetration.

Mr. Madel: Does my right hon. Friend agree that one of the reasons for the improvement is that the Government have avoided putting too much industrial relations law on the statute book? Does he further agree that the main thing now is to build up the influence of the Advisory, Conciliation and Arbitration Service in solving industrial disputes?

Mr. King: I should like to think that ACAS is now well established. In spite of earlier attempts to make me supplement or intervene in the work of ACAS, its independent role is recognised, I hope, by both sides of the House. I should have thought that the whole House would welcome—I am not sure that one part does—the fact that there has been an enormous reduction in the number of days lost through industrial disputes. I should not have thought that anyone with a sensible approach to industrial relations wants a strike in any case.

Mr. Campbell-Savours: Is it not fair to say that if there were full employment tomorrow there would be chaos in industrial relations?

Mr. King: That is absolute rubbish. A considerable number of people now appreciate the benefit of uninterrupted work for themselves and their earnings. Performance, not least in the car industry, is clear evidence of that.

Health and Safety at Work etc. Act 1974

Mr. Fatchett: asked the Secretary of State for Employment whether he is satisfied with the current level of penalties against employers who are found to be in breach of the Health and Safety at Work etc. Act.

Mr. Gummer: I certainly share the widespread concern on this matter. My right hon. and learned Friend the Secretary of State for the Home Department intends to make an order during the coming months which will, among other things, raise the maximum level of fines available on summary conviction under the Health and Safety at Work etc. Act.

Mr. Fatchett: I am grateful to the Minister for his response and his acknowledgement that the current level of fines is too low. Will he take steps to increase staffing in the Health and Safety Executive so that not just the fines will be increased but enforcement can take place? It is crucial that the HSE has the manpower to ensure that the legislation is enforced so that the courts can take the necessary action.

Mr. Gummer: The Government believe in the importance of such action. That is why we have increased the resources made available to the Health and Safety Executive.

Mr. Rowe: Can my hon. Friend give the House any information about the steps that he proposes to take to reduce the menace of noise at work?

Mr. Gummer: My hon. Friend might be pleased to know that today we are announcing another programme to enforce more clearly the regulations that arise from the code of practice on noise at work. The Factory Inspectorate will increase the attention that it pays to noise, which is now one of the major causes of industrial injury. We hope, as a result of this major programme, to bring to people's attention the dangers to their hearing and the penalties that are available under the Health and Safety at Work etc. Act 1974. We hope to save more people from the menace of deafness.

Mr. Eastham: Is the Minister not ashamed to note that there are now 145 fewer factory inspectors than there were in 1979? Is he not also ashamed to note that the number of accidents is increasing because of the Government's policies? More people are being killed and maimed in factories.

Mr. Gummer: I should be ashamed to ask the hon. Gentleman's question and fail to mention that the accident record has been improving. The hon. Gentleman's question was disgraceful. He should look at the figures. I am happy to go through them one by one with him. With the introduction of modern computerised techniques we are able to use the work of devoted factory and other inspectors much more effectively. We have increased the resources made available to the Health and Safety Executive. That is an improvement on what the Labour Government did.

Mr. John Evans: Will the Minister take this opportunity to inform the House that far more days are lost in British industry because of industrial injuries and sickness than are ever lost through industrial disputes? If the Government's anxiety about loss of working time in industry is to be taken seriously, will the Minister take this opportunity to instruct the Health and Safety Executive to employ far more factory inspectors, who do an excellent job of persuading recalcitrant employers to adopt reasonable safety standards for the benefit of their work force?

Mr. Gummer: The Government are worried about the number of days lost through accidents and injuries at work and by the number of days lost through industrial unrest. We are trying to deal with both. To deal with the second we are taking an excellent Bill through Parliament. We have found that the Opposition have been so incompetent at opposing it that they have not yet found one reason for opposing any part of it.

Youth Training Scheme

Mr. Greenway: asked the Secretary of State for Employment how much has been spent in the current year on the youth training scheme; out of what level of allocation of Government funds; and if he will make a statement.

Mr. Tom King: By the end of November 1983 some £457 million had been spent against an allocation of £852 million for youth training in 1983–84. The final outturn for the year is still uncertain, although it is now clear that not all of the resources originally allocated will be required.

Mr. Greenway: I congratulate my right hon. Friend on the increasing take-up of the scheme. Will he use money that will not be spent on it to increase the fee paid to local


education authorities from £14·70, which they are finding impossibly low to run college courses for the youth training scheme? Will he allocate any other money that is left over to the community programme?

Mr. King: I am grateful for my hon. Friend's support for the scheme. People who have seen it in operaton—I have had a chance to visit several schemes—have been enormously impressed by the effort that has been made and by the interest that is being taken in it, especially by employers. I note my hon. Friend's point and will look into it.

Mr. John Fraser: If there is a substantial amount of money left over from the youth training scheme, might the Secretary of State's Department give it to the Department of the Environment to make up the shortfall of money for boroughs such as Lambeth, which is doing a great deal to train people in areas where there is massive unemployment?

Mr. King: The hon. Gentleman might tempt me on to country that I know rather too well, so I do not think that I shall trespass on it today.

Homeworking Advisory Committee

Mr. Janner: asked the Secretary of State for Employment whether he will take steps to ensure regular meetings of the homeworking advisory committee.

Mr. Gummer: We have no plans at present to reconvene the committee.

Mr. Janner: Is the Minister aware that homeworkers and outworkers are largely unprotected by any employment legislation and, as a result, are among the most exploited section of our work force and are treated in many areas nearly as slave labourers? Is he not prepared to do anything to help them by reactivating the committee or otherwise?

Mr. Gummer: It is because I take this matter so seriously — [HON. MEMBERS: "Ah!"] Hon. Gentlemen may say "Ah!", but if they listen to the answer they might say "Hooray!" We are concerned to conduct a systematic research programme to identify precisely the problems and where they are so that we can give them sensible answers. I am sure that the hon. and learned Member agrees that it is better that we act on information rather than the generalisation that he puts forward.

Ms. Richardson: Does the Minister recognise that this problem did not arise yesterday? Much research has taken place on homeworking which is, more than any other form of employment, a cheap way for employers to deal with labour. Does he not realise that this issue affects many hundreds of thousands of women in the country who are badly paid, and who must provide their own equipment and the cost of heating and lighting? Will he please do something about the matter urgently?

Mr. Gummer: The hon. Lady does her case no good by suggesting that all homeworking is bad and that all employers are paying badly. [Interruption.] If she re-reads her question, she will find that it was put in exactly those terms. To ensure that we deal with the abuses but do not lose the jobs, we are getting the facts rather than relying on some generalisation of party political comments.

Confederation of British Industry

Mr. Knox: asked the Secretary of State for Employment if he will meet the Confederation of British Industry to discuss the long-term improvement of industrial relations.

Mr. Alan Clark: My right hon. Friend is in regular touch with the CBI on this and other issues; meetings are held from time to time.

Mr. Knox: When my hon. Friend next meets representatives of the CBI will he impress on them the importance of greater employee participation as a means of improving industrial relations in the long term? Does he think that British industry is doing enough about that?

Mr. Clark: We welcome increased employee participation on a voluntary basis, with the consent and readiness of both parties to partake. We are against legislation, which is why we view with some misgivings the EC draft directives on this subject.

Mr. Wrigglesworth: If the Government are intending to continue to press for balloting in trade unions, will they think again about their commitment to work place ballots in the light of the NUM election which has taken place in the last few days? Will they reconsider postal balloting? Is it not clear from the leaked press reports during the past few days that there has been no secrecy in the NUM ballot, and that postal balloting is the only means of overcoming the problem?

Mr. Clark: The hon. Gentleman may know —although he is not a very frequent visitor to the Committee and I cannot recall whether he was present at the time — that the subject of postal balloting was dealt with recently in Committee.

Dimbleby and Sons v. NUJ

Mr. Dalyell: asked the Secretary of State for Employment what amendments he is considering to current legislation in the wake of the judgment in the case of Dimbleby and Sons versus the National Union of Journalists.

Mr. John Smith: asked the Secretary of State for Employment if he is considering amendments to legislation in relation to secondary industrial action following the judgment in the case of Dimbleby and Sons Ltd. versus the National Union of Journalists.

Mr. Tom King: An appeal against the Court of Appeal's judgment in this case is to be heard by the House of Lords on 1 February. It would, therefore, not be right for me to comment on the case or its possible implications at this time.

Mr. Dalyell: Does the Secretary of State agree that, if the judgment in the case of Dimbleby and Sons Ltd. v. the National Union of Journalists is allowed to stand, employers will be able to turn primary industrial action into secondary industrial action and push trade unions, whether they like it or not, into conflict with the Government's laws? Is that not the position?

Mr. King: The hon. Member is inviting me to do exactly what I said I was unable to do because the case is going to appeal. It would not be helpful for me to comment at this time.

Mr. Smith: Does the Secretary of State not realise the enormous importance of the decision in this case, because an employer, by manipulating company law and by creating a subsidiary company, can place employees who are engaged in primary industrial action into secondary industrial action and cause mayhem with the application of the Government's own laws? If the judgment stands, do not the Government have a responsibility immediately to repeal the legislation? Otherwise, will not their assurances to the workers be shown to be worthless?

Mr. King: As I have said to the hon. Member for Linlithgow (Mr. Dalyell), I am not proposing to comment at this stage, but we shall study the findings of the court with great interest.

Youth Training Scheme (Safety)

Mr. Gareth Wardell: asked the Secretary of State for Employment when he will introduce legislation to improve safety provisions covering people on youth training schemes.

Mr. Gummer: Youth training scheme trainees have always been covered by the Health and Safety at Work etc. Act 1974. In order to make the situation absolutely clear, I laid the Health and Safety (Youth Training Scheme) Regulations 1983, which ensure that all YTS trainees are covered by precisely the same sections of the Act as employees.

Mr. Wardell: Why do the regulations and the safeguards not apply to YTS trainees on courses arranged at colleges of further education?

Mr. Gummer: The commission is currently holding discussions with interested parties to decide how best to cover the position of trainees outside the work place.

Oral Answers to Questions — PRIME MINISTER

Engagements

Mr. Winnick: asked the Prime Minister what are her official engagements for 24 January.

The Prime Minister (Mrs. Margaret Thatcher): This morning I had meetings with ministerial colleagues and others, including one with the Secretary General of the OECD. In addition to my duties in the House I shall be having further meetings later today.

Mr. Winnick: Is it not deplorable that the right hon. Member for Down, South (Mr. Powell) should try to bring the Queen into public controversy because of his obsession about the Commonwealth and ethnic minorities? Should not the right hon. Lady strongly criticise his remarks, or is she too busy pandering to the same deplorable prejudices?

The Prime Minister: The Queen makes her Christmas broadcasts as head of the Commonwealth. She does not, therefore, make them on the advice of United Kingdom Ministers. The broadcasts are greatly valued, as a personal message from the Queen at Christmas, in homes throughout Britain and the Commonwealth.

Mr. Farr: When my right hon. Friend met the President of France yesterday, did she take the opportunity to raise with him the deplorable conduct of the French

workers who hijacked British lorry drivers? Did she seek an assurance that the French Government would do their best to prevent such an incident occurring again?

The Prime Minister: I am sure that my hon. Friend will agree that the President of France took firm action when the incident occurred, and we should be grateful for that.
I discussed mainly three matters with the President. First, we discussed the European Council in Brussels and whether it was possible to reach a settlement on the outstanding matters between the partnerships in the Community. Secondly, we discussed the multinational force in the Lebanon. Thirdly, we discussed East-West matters.

Mr. Donald Stewart: Is the Prime Minister aware of the amazement of many people at the Government's indifference to the appalling shrinkage in the Merchant Navy? If the right hon. Lady is indifferent to the implications of that for employment and trade, will she at least recognise its implications for defence in a maritime nation?

The Prime Minister: It is true that some of our charters and charges have been undercut by other nations. We must be every bit as competitive as they are if we are to continue to gain a good deal of the merchant trade, especially the cross trade. The right hon. Gentleman will be aware that the Government agreed to help British Shipbuilders to replace the Atlantic Conveyor through an order from British yards.

Mr. Marlow: asked the Prime Minister if she will list her official engagements for 24 January.

The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.

Mr. Marlow: Is it not the case that the Inner London education authority was set up by central Government? Therefore, how is it possible for it to lavish large sums of public money on an offensive and distorted propaganda campaign, such as this which I hold in my hand? Will my right hon. Friend ask the district auditor to investigate the matter urgently? While the district auditor is about that, could he find out why it costs twice as much to educate a child in a primary school in London as it costs in Northamptonshire, where the education happens to be a great deal better?

The Prime Minister: The auditors have a duty to look at all spending by local authorities to ensure that it is properly and carefully incurred. Any local elector can make a complaint about a particular item and the auditor is then bound to consider that matter. I agree with my hon. Friend that the education costs of ILEA are, in some respects, about 60 per cent. above those of other authorities.

Mr. Kinnock: On the subject of young people, is the Prime Minister aware that there are now 400,000 unemployed 18 and 19-year-olds in Britain? Not only do they not have work, but they have no education and no training— [Interruption.] The contempt of Conservative Members for unemployed youngsters is always obvious, and it has been added to today. What does the Prime Minister plan to do to help those youngsters to help themselves to get a decent start to their adult life?

The Prime Minister: We are making strenuous efforts to ensure that young people, before they reach that age, are properly trained and properly educated. The right hon. Gentleman will be aware of some of the initiatives. He will be aware also of what my right hon. Friend the Secretary of State for Education and Science did for technical education in schools, which was not carried out during the lifetime of the last Labour Government. He will be aware of the efforts to install computers in schools. He will be aware of the many computer centres established throughout the country for training young people, including those of this age, and he will be aware of the youth training scheme, which ensures that young people, before they get to this age, are properly trained and equipped and therefore have a better chance to secure a job later.

Mr. Kinnock: Many of those stratagems are welcome, but they do not help the 18 and 19-year-olds who do not have jobs, training or education now. If the Prime Minister does not understand the question as it relates to them, and if she does not understand the problem as it relates to them, may I ask her, as a parent, to put herself in the position of a parent of some of these young people and tell us now how she thinks her children could manage on £21·45 a week with no prospect of jobs, education or training? Will she now do something tangible, positive and practical to ensue that this age group is properly attended to?

The Prime Minister: I have indicated some of the fundamental measures that we are taking. With regard to other matters, the right hon. Gentleman is talking about how best to create more genuine jobs in the future. He is very well aware that there is only one way, and that is by producing goods and services that other people will buy, and producing them at a cost that they can afford. That is the way in which the Government will go. That is why we are doing so much to help small businesses and to encourage the formation of new products in the latest technological services.

Sir Hector Monro: Will my right hon. Friend take an opportunity today to pay tribute to those in Scotland, the north of England and elsewhere who are suffering fiendish weather conditions and trying to overcome them? Would she perhaps mention the helicopter crews, the police, the snow plough drivers and the mountain rescue teams, farmers and farm workers, who are doing their very best to overcome dreadful conditions?

The Prime Minister: I glady respond to my hon. Friend's invitation. I think we all admire the rescue workers who have gone out in these terrible conditions—the helicopter pilots, the police and everyone who has helped—and would like them to know that the House offers its thanks and congratulations to them.

Mr. Beith: Now that the Prime Minister has again failed to secure the support of some of her right hon. and hon. Friends for her local government policies, will she recognise that she has it wrong? Does she recognise that, so far from attacking the vested interest of local government, she is actually enhancing the biggest vested interest of all, central Government bureaucracy? If she wants to stop unrepresentative minorities spending ratepayers' money, why does she not support proportional representation?

The Prime Minister: If throughout the rest of my political life in this Parliament, and in the next, I never have a majority below what we had last night, I shall be very satisfied.

Mr. Tim Smith: asked the Prime Minister if she will list her official engagements for Tuesday 24 January.

The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.

Mr. Tim Smith: Is my right hon. Friend aware of the remarks of the Leader of the Opposition on Sunday when he described all those millions of people in work who do not belong to a trade union as scroungers? Does my right hon. Friend agree that this description is bitterly resented by all those hard-working people?

The Prime Minister: Yes, I observed what the right hon. Gentleman said, and I agree with my hon. Friend that such a description would be bitterly resented, because most people believe that they should have the right to choose whether to join a union. Most, indeed the overwhelming majority, of people in Britain are pleased about the legislation that we have passed, which strengthens the right of the individual worker against the trade unions.

Mr. Lofthouse: Will the Prime Minister inform the House whether her son received any financial reward whatsoever for his efforts—and her efforts too—on behalf of the Cementation company?—[HON. MEMBERS: "Cheap."] Conservative Members may not want to hear this, but they are going to get it. Did the Prime Minister's son receive any financial reward for his efforts—and her efforts — on behalf of the Cementation company in gaining a contract in Oman? Will she, for the benefit of the country, answer with a straight yes or no?

The Prime Minister: I answer for my public duties from this Dispatch Box. [HON. MEMBERS: "Answer."] Members of my family are as much entitled to privacy in going about their private duties as are any other citizens. I refer the hon. Gentleman to what the Select Committee said in 1975:
A Member of Parliament must expect to be subjected to thorough public scrutiny in the performance of his public duties. He is also, however, a private individual, and is entitled to a proper degree of privacy. His wife and children are equally entitled to such privacy.

Mr. Jackson: Reverting to my right hon. Friend's visit to Paris yesterday, does she agree that it is welcome to see President Mitterrand at last taking a measure of personal control of the French position in these negotiations? Would she consider it welcome if the French Presidency of the Community succeeded in bringing to the discussions a conclusion by the March European Council?

The Prime Minister: Yes, I agree with my hon. Friend, but there is much to do during the coming weeks and therefore the President is tackling the matter vigorously. It is absolutely vital to us, if there is to be any increase in own resources, that is a fundamentally different way of sharing the burden of the Community budget. It is also extremely important to us that there are strict financial guidelines. Both are important if there is to be a solution in March.

Mr. Canavan: asked the Prime Minister what are her official engagements for 24 January.

The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.

Mr. Canavan: When the Prime Minister casts her vote at the end of the Scott Lithgow debate, will she be batting for Britain or for overseas shipyards? Why is it so difficult to muster the political will and necessary money to intervene here in the renegotiation of a contract when she can find billions of pounds to spend on the Falkland Islands, including a handout of over £7 million for 54 prefabs to a Swedish company, with the possible help and intervention of a former British ambassador?

The Prime Minister: To secure business overseas British shipyards must be as good as any in the world. They must be able to produce their products within budget and on time. Only then will we be able to compete with the rest of the world. The hon. Gentleman will be aware that since nationalisation the taxpayer has paid about £165 million to Scott Lithgow, and during the last year the amount was equal to £13,000 per employee. We must win contracts by being very good and by completing ships and rigs on time.

Mr. John Townend: Is it not a strange world in which the Welsh leader of the Opposition refuses to attend an international at Cardiff Arms park merely because a team of mixed race schoolboys from South Africa is there? Is

it not even stranger when Ministers at the Welsh Office take the same action? As the Russian have committed far more acts against humanity than have the South Africans, should we not end such double standards and either discourage Russian teams or give notice that we wish to terminate the Gleneagles agreement?

The Prime Minister: I cannot terminate the Gleneagles agreement, to which this country is a party, and which we must uphold. It is a voluntary agreement and we try to see that it is honoured in that spirit. I understand that it was a very good match.

Mr. Sedgemore: Talking about scroungers, may I ask the Prime Minister to tell us whether it was her influence or that of the Cementation company that enabled her son to fly through Oman on a plane owned by the Omani air force—or does she not care to distinguish between grace and favour business deals and grace and favour political deals?

The Prime Minister: I answer for carrying out my public duties, and thay are all in the public domain. Members of my family are as much entitled to privacy as those of any other citizen in the United Kingdom. We have not yet reached the stage when parents and their sons have to report everything to the authorities. If it comes to that, 1984 will be here.

Disarmament (Stockholm Conference)

The Secretary of State for Foreign and Commonwealth Affairs (Sir Geoffrey Howe): Last week I attended the opening meeting in Stockholm of the Conference on Confidence and Security Building Measures and Disarmament in Europe, known as the CDE. It is the first of the follow-up conferences agreed at the CSCE review meeting in Madrid last September; and the opening was attended by the Foreign Ministers or their equivalents of all 35 participating states. On Friday, I delivered an opening speech on behalf of the United Kingdom. A copy has been placed in the Library of the House.
This is the first time that so many states have met together specifically to tackle some very basic questions affecting the security of Europe. The aim is to lower tension and reduce the risk of war by finding practical ways of improving mutual confidence and trust.
Together with our allies, we are today tabling proposals which, as the terms of reference of the conference require, are militarily significant, politically binding, verifiable and applicable to the whole of Europe. We are proposing measures designed:
first, to reduce secrecy by the exchange of information and by the observation and inspection of military activities;
second, to make clear provision for the advance notification and reporting of military activity;
third, to promote stability and to inhibit the use or threat of force for political purposes;
and fourth, to facilitate crisis management in periods of tension and to reduce the risk of surprise attack.
If we can secure agreement on measures of this kind, I have no doubt that Europe will be a safer place. We would then be in a position, as I told the conference, to consider moving to further stages of negotiation, providing for the restriction of military activities and for reductions in force levels. The first job must be to build a basis of confidence by measures of the kind that I have described.
I emphasised that arms control negotiations alone cannot and should not have to bear the full weight of East-West relations. The dialogue between East and West needs to be broadened and given more substance.
My meeting with Mr. Gromyko on Thursday thus gave me the opportunity to discuss with him not only arms control but East-West relations more generally, as well as the middle east. I also raised with him the question of Soviet fulfilment of its international commitments in the field of human rights. We agreed that arrangements should be made for a further meeting between us.
The opening of the Stockholm conference came at a difficult time in East-West relations. The difficulties remain, but I hope that I shall be proved right in seeing in the events of last week signs of a new determination to tackle them. We must look to the causes of tension and try to reduce them. At Stockholm and elsewhere, that remains our purpose.

Mr. Denis Healey: The Foreign Secretary must realise that he has given us a depressing account of the recent meeting in Stockholm, which forms a startling contrast to the claim of all Government Ministers in recent months that the moment that cruise and

Pershing were deployed the Soviet Government would be prepared to talk to us and make concessions about everything. What must worry all people throughout the Western world is that technology is now moving at the speed of lightning and that diplomacy is moving with the stately majesty of a glacier. The responsibility for that must lie in part with Western Governments, including Her Majesty's Government.
Did the right hon. and learned Gentleman discuss with Mr. Gromyko during his talks last week the conclusion of all the leading Western scientists of the United States, Europe and the Soviet Union that if only one out of every 200 nuclear weapons possessed by the superpowers is used the country using that weapon will condemn its own people to slow starvation in arctic night? Does that not have important implications for all Governments on both sides of the iron curtain, and does it not make total nonsense of the attempt by the Soviet and Western Governments to pile more weapons on top of the totally redundant and unusable armouries that they already possess?
Would the right hon. and learned Gentleman tell us a little about the implications of his statement that it is important to discuss East-West relations more generally? Does he really believe that the Prime Minister's visit to Hungary will fulfil that need? Is it not rather like visiting the mayor of Reading because one does not want to talk to the leader of the GLC?

Sir Geoffrey Howe: The right hon. Gentleman has revealed a curious insight into the pattern of international relations. My right hon. Friend the Prime Minister will visit Hungary between 2 and 4 February, and it is important to recognise that contact with all countries in the so-called Eastern bloc has a part to play in improving relations. Such contacts should be looked at and considered separately. Certainly they should all be undertaken alongside one another.
I agree with the right hon. Gentleman that the scene we faced in Stockholm—indeed, the scene that the peoples of the world faced—is a depressing one simply because of the difficulty that has been faced in securing progress in the many fora for arms reduction. That is one of the features that overshadowed all our talks there. It is certainly true, as we were all well aware, that the use of any single nuclear weapon is something that should be avoided at all costs. It should also be remembered that the surplus of longer-range international nuclear forces held by the Soviet Union overshadows that of the United States by five to one, and there is a not quite so large but similarly daunting disparity in the possession of strategic missiles on the Soviet side. So it is of the utmost importance to press ahead with the negotiations that we are trying to get under way.
The glacier-like quality of decision—taking in the Soviet Union is, unfortunately, a formidable feature of the scene that we have to face. We very much regret that the Soviet Union has withdrawn from the INF and START negotiations. We hope that discussion through the normal diplomatic channels will lead to a resumption of the MBFR talks on 15 and 16 March. It should be acknowledged that it was only the preparations of the Alliance for deployment that brought the Russians to negotiate in the first place. It is only by sticking to


NATO's INF' policy that we shall show the Soviet Union that agreement on all these matters remains profoundly in its interests.

Mr. Healey: The right hon. and learned Gentleman appears not to have listened to what I said or even to have read the papers that were prepared by his own advisers. Is it not the case that in long-range nuclear missiles and strategic nuclear weapons there is now rough parity between the Soviet Union and the West? That has been conceded by all leading spokesmen of the United States and, until this afternoon, by spokesmen of Her Majesty's Government.
Secondly, does the right hon. and learned Gentleman accept the view expressed by leading scientists in the United States, Britain, Europe and the Soviet Union that to use even one out of 200 of the existing nuclear weapons would condemn the world to the destruction of humanity and the slow death of our populations in arctic night? Has he drawn any conclusions from this important finding?

Sir Geoffrey Howe: I need no reminding of the emphatic importance of avoiding the use of nuclear weapons and of taking all the steps we are seeking to take, wherever we have the opportunity, to secure their reduction for precisely the reasons offered by the right hon. Gentleman in his closing remarks.
In reply to the right hon. Gentleman's first question, the destructive power of Soviet strategic missiles is more than twice as great as that of the United States. In regard to longer-range intermediate nuclear forces, the Russians possess a superiority of five to one. Those are the reasons why we should be so concerned.

Dr. David Owen: Will the Foreign Secretary accept that many countries in NATO now want to see a meeting between President Reagan and Mr. Andropov? Since Mr. Andropov's health is reported to be better and he is likely to be seen in public, will the British Government make it clear that they wish such a public meeting to take place? In regard to the confidence-building measures, will NATO now propose in Stockholm a corridor in which we will withdraw battlefield nuclear weapons, which would be the best confidence-building measure that could be taken and which would alleviate the considerable public concern about any battlefield nuclear war fighting strategy?

Sir Geoffrey Howe: As I said in my statement, the Stockholm conference at this stage is concerned only with measures that arise out of the terms of reference that were agreed after a great deal of tribulation at Madrid, so it is not the appropriate place in which to make a proposal of the kind referred to by the right hon. Gentleman. As I also said in my statement, if we are able to reach agreement on the measures that are within the terms of reference, we shall want to see whether we can go further in the direction suggested by the right hon. Gentleman.
In regard to visits between President Reagan and Mr. Andropov, I am not, of course, able to give any definite information about Mr. Andropov's health, although we must all hope that it is improving. It will be for the President of the United States to consider the suggestion made by the right hon. Gentleman. Certainly we believe that it would be desirable to intensify the dialogue, both in quantity and in quality, at all levels, remembering that if there is anything less fruitful than the absence of

meetings at top level it is a meeting that has been inadequately prepared. We must take encouragement from the fact that in a speech last week President Reagan offered to the Soviet Union a constructive and realistic working relationship, which is appropriate.

Sir Peter Blaker: Is my right hon. and learned Friend aware there will be a welcome from the House for the fact that the British Government have put forward these practical proposals? Was he able to discern in the remarks of the spokesman for the official Opposition this afternoon any practical proposal related to the purpose of the conference, which is to improve confidence-building measures in Europe, or any practical proposal at all?

Sir Geoffrey Howe: I am grateful to my right hon. Friend for his remarks and I leave him to confirm the judgment he made.

Mr. J. Enoch Powell: If, in the words which the Secretary of State has just used, the use of a nuclear weapon is to be avoided "at all costs", what is the point of having one?

Sir Geoffrey Howe: I think it is universally acknowledged that the possession of these fearful weapons has probably been the most important foundation of the absence of war in Western Europe during the past 38 years.

Mr. Churchill: While entirely predictable, is it not regrettable that the right hon. Member for Leeds, East (Mr. Healey) should once again be seeking to blame the Western democracies for the failure of the recent nuclear arms negotiations? Bearing in mind that since the start of the INF talks in 1981 the Soviet Union has deployed no fewer than 108 SS20 missiles, each the equivalent of 100 Hiroshima bombs, it is utterly unwarranted that it should use as a pretext to walk out of the INF talks the deployment of a couple of score of Western missiles in Western Europe. Would it not he more appropriate for the right hon. Member for Leeds, East, instead of castigating the NATO allies, to urge upon the Soviet leadership that it should resume its place in these talks?

Sir Geoffrey Howe: I entirely agree with my hon. Friend. One SS20 has been deployed during each of the weeks of the two years since the deployment of SS20s started. Throughout those two years the United States persisted in its participation in the INF negotiations. It is a matter for extreme regret that the Soviet Union chose to discontinue those talks as it did and when it did. It is entirely right for my hon. Friend to urge upon the right hon. Member for Leeds, East (Mr. Healey) and the House the need to remind the Soviet Union of the need for it to return to negotiations and the extent to which we are willing to welcome it.

Mr. Robert Parry: Will the Foreign Secretary confirm that in his address Mr. Gromyko accused the United States of thinking in terms of war, especially since the deployment of cruise missiles in Western Europe? In view of the growing opposition of the British public to the deployment of cruise on British soil, which has been shown in recent opinion polls, will he bear that fact in mind when he next meets Mr. Gromyko?

Sir Geoffrey Howe: I shall bear considerably in mind that the British public supported the Government's policy at the general election. As the House knows, deployment is taking place notwithstanding the sustained attempts by the West to secure participation by the Soviet Union in meaningful negotiations. The hon. Gentleman is right to say that Mr. Gromyko referred to the conduct of the United States in terms that were intemperate and disrespectful. I reminded the conference of the proposition which Mr. Gromyko quoted from Mr. Andropov, in which he called for the conduct of calm and respectful relations between states. I hope that that advice will be heeded by the Soviet Union itself.

Mr. George Walden: Does my right hon. and learned Friend agree that there is an uncanny symmetry between the negotiating tactics used by the Leader of the Opposition on the Elgin marbles and his position on the British nuclear deterrent.

Sir Geoffrey Howe: My hon. Friend makes an entirely fair comparison, which is not one to be taken lightly. If the Leader of the Opposition were ever to be in a position to decide matters of this sort, he would be making decisions similar to those that he made on the Elgin marbles but of much greater gravity to the British people.

Mr. A. J. Beith: As the right hon. and learned Gentleman recognises the importance of confidence-building measures, may we assume that the rhetoric of war will come out of the Prime Minister's speech-making vocabulary? Does he see as part of the process of confidence building an exchange of visits between the Soviet leadership and leaders from Britain at a fairly early date?

Sir Geoffrey Howe: The rhetoric of war has no part in my right hon. Friend's vocabulary. The position adopted by the Government has been to declare firmly our determination to defend the interests of the British people if necessary and, equally fairly, our determination to seek disarmament by any legitimate means.
As for the prospect of further contacts, my hon. Friend the Minister of State, Department of Trade and Industry, will be visiting the Soviet Union in May at the next meeting of the Anglo-Soviet Joint Commission. We hope to be able to welcome to Britain before long the First Deputy Foreign Minister of the Soviet Union, Mr. Kornienko. I hope to be able to arrange a meeting of a more substantial sort with Mr. Gromyko before we meet, as will be the normal practice, at the United Nations General Assembly.

Mr. Jonathan Aitken: Will my right hon. and learned Friend take the opportunity of pouring scorn on the somewhat convoluted metaphors of the right hon. Member for Leeds, East (Mr. Healey) about Artie glaciers and mayors, and acknowledge the two real reasons why there was no fundamental progress in the talks? Does he agree that Mr. Gromyko could not take any initiatives because of the paralysing sickness of Mr. Andropov and did not want to take any initiatives for fear that they might help President Reagan in his re-election?

Sir Geoffrey Howe: I cannot pronounce upon the second reason given by my hon. Friend, but it is certainly a factor that is suggested. Nor can one be sure of the impact of Mr. Andropov's health on the Soviet Union's position. The decision-taking process within the Soviet

Union, even under normal conditions, is a slow and protracted one. That is why it will be necessary for us to maintain the presentation of the urgency of our case for genuine, verifiable and balanced disarmament with tenacity and purpose.

Mr. Dick Douglas: Will the Secretary of State, in terms of confidence-building measures, reveal how many manoeuvres on either side have been examined by observers from either side? Have any of those manoeuvres involved the observation of battlefield nuclear weapons? If the right hon. and learned Gentleman resists the area of activity that we are discussing as being the appropriate forum, which forum will we deploy to discuss the prevalence in Europe of large quantities of so-called battlefield nuclear weapons that will be used, overrun or destroyed within hours of a nuclear war?

Sir Geoffrey Howe: I cannot without notice answer the hon. Gentleman's specific factual questions. The negotiations have relatively restricted first terms of reference that do not take us as far as consideration of battlefield nuclear weapon control. The INF and START negotiations have been broken off, and we hope shortly to resume the MBFR negotiations in Vienna. It is worth noticing, however, that since 1979 there has been a reduction of about 2,400 in the warheads available to NATO within Europe.

Several Hon. Members: rose—

Mr. Speaker: Order. This is an important statement, but I remind the House that later this afternoon we shall have two important Opposition day debates and a ten-minute Bill. I propose to take three questions from each side.

Mr. John Wilkinson: Will my right hon. and learned Friend, in seeking to re-establish the MBFR talks in Vienna, bear in mind that those talks, until they were abruptly called off, had persisted since 1973 without any progress because the Soviet Union refused a proportionate reduction in armed forces? Will my right hon. and learned Friend therefore make certain that the Western powers are not strung along in the new Vienna talks while the Soviet Union continues to augment its nuclear build-up?

Sir Geoffrey Howe: I take the force of my hon. Friend's point. We believe that the Western draft treaty at those talks remains a sound basis for agreement. Obviously we will keep the prospects and progress of the negotiations under review when and if they start, and we will ensure that they are not used as a substitute for action in other directions if we can achieve that.

Mr. Norman Atkinson: Is it not a fact that every NATO and Chinese nuclear weapon can reach and is targeted upon Soviet territory, yet only a small proportion of Soviet nuclear weapons can reach and is targeted upon United States' territory? Is it not a fact that, until that understanding spreads throughout the NATO leadership, little or no progress will be made at any future meetings, whether or not the Soviet Union returns to the negotiating table in March or at any other time?

Sir Geoffrey Howe: It is important to try to secure progress in any of the many negotiations that are occurring. The first condition to establish the prospects for


progress is for the Soviet Union to be willing to return to meaningful negotiations. That is why we are insistent upon our willingness to receive the Soviets as soon as they return.

Mr. Michael Latham: Following the declaration of the NATO powers on 9 December that their weapons would never be used first except in response to attack, did the Western powers consider not only today's measures but tabling at the conference a new draft treaty that there will be no first use of any weapons by either side which would go some way towards meeting the Warsaw proposal for a non-aggression pact?

Sir Geoffrey Howe: NATO has repeatedly said that it will never use any weapons, nuclear or conventional, in response to attack. [HON. MEMBERS: "No."] Except in response to attack. I am sorry if I misled the House. NATO has repeatedly said that it will never use any weapons, nuclear or conventional, except in response to attack. A similar obligation is entered into by each member of the United Nations, and we believe that that is the right position.

Mr. Robert Litherland: Does the Secretary of State wish to comment on Mr. Shultz's reference in Stockholm to artificial barriers in Europe, which could only refer to reunification of Germany? Does the right hon. and learned Gentleman feel that that helped the peace talks?

Sir Geoffrey Howe: It has long been recognised by successive Governments that the division of Germany is not something which is likely to or should endure permanently. Equally, it has long been recognised that the division of Europe based purely on a sharp differentiation between East and West is not for the long-term good of the continent. We must all hope that divisions of that kind will be replaced by a growing sense of the unity of culture and history which is part of the European continent.

Mr. David Sumberg: Does my right hon. and learned Friend agree that if the Soviet Union is genuine in its desire to build up mutual confidence and trust it should immediately increase the number of exit visas for people who wish to leave that country and release Anatoly Shcharansky from imprisonment?

Sir Geoffrey Howe: I agree with the force of my hon. Friend's point. I made it clear to Mr. Gromyko that the extent to which the Soviet Union is willing to fulfil its

international commitments on human rights has an important impact on international perception of that country and confidence in its actions. I could not bring every specific case to his attention, but I selected a number of examples, all of which involve the ill health of the people concerned and specifically Mr. Anatoly Shcharansky and Mrs. Bonner Sakharov.

Mr. Healey: Does the Foreign Secretary agree—even Mr. Nitze and Mr. Kvitsinsky agree on this—that before the weapons were deployed by the West the Soviet Government offered to reduce the number of intermediate-range warheads to under half the number deployed when NATO took its dual track decision in December 1979, as both sides have confirmed? Does the right hon. and learned Gentleman agree that we now face a far more dangerous situation in which both sides are continuing to pile up weapons which have no conceivable political, military or other advantage, especially in view of the discovery of the risk of a nuclear winter if just one out of 200 existing weapons were ever used? Does he accept that many Opposition Members and, I suspect, Conservative Members cannot accept the hibernation of our Foreign Secretary when the world faces such dangers, although winter and summer seem to make little difference to the right hon. and learned Gentleman and he seems not even to understand the Government's policy, as we realised when he informed us, I hope rightly, that the British Government would never use nuclear weapons in response to an attack?

Sir Geoffrey Howe: The right hon. Gentleman has to look a long way to find any points to make, and they all lack validity. The matter is too serious for such triviality. Far from hibernating, we are devoted to the pursuit of effective, balanced, verifiable disarmament measures.
The right hon. Gentleman mentioned the Soviet Union's offer during the INF talks. It is difficult to be confident or certain about what the final offer was. but it seems to have been 120 SS20s within range of Western Europe—

Mr. Healey: That is fewer than in 1979.

Sir Geoffrey Howe: —in return for no deployment of United States weapons. The Soviet Union would have remained in possession of 800 SS20 warheads world-wide. It will have modernised its weapons considerably since 1979. As the offer involved no United States deployment in Western Europe, it would not have been a balanced or satisfactory conclusion.

Ministerial Responsibility and Accountability

4 Pm

Mr. Brian Sedgemore: I wish to raise a point of order of which I have given you, Mr. Speaker, notice. It touches the heart of the issue of ministerial responsibility and the accountability of Ministers to the House.
Last Tuesday I tabled seven questions to the Secretary of State for Energy about the safety of the civil nuclear programme and the incidence of cancer at Sellafield. Yesterday I was astonished to receive a reply from the Minister saying that the questions had been transferred to the chairman of British Nuclear Fuels Ltd. and that a copy of the chairman's answer to me would be placed in the Library. It is extraordinary that a Minister should abdicate his statutory responsibilities in favour of the chairman of a company.
I have worked in the Department of Energy, and I know that the Secretary of State is charged with overall responsibility for the safety of the British civil nuclear programme. If the chairman of BNFL gives me a wrong or misleading answer, what shall I do? Is he responsible, or is the Minister responsible?
BNFL faces the possibility of prosecution by the Director of Public Prosecutions, and an eminent scientist is studying the incidence of cancer in and around Sellafield. At such a time, Ministers may well wish to wash their hands of what BNFL is doing. However, they are statutorily responsible, and it would be a help to the House and to the nation if they were to answer before the House. I ask for your guidance on this point, Mr. Speaker.

Mr. Speaker: The hon. Gentleman gave me notice of his point of order. However, I am sorry to have to tell him that I have no responsibility for the content of ministerial answers.

North England and Scotland (Weather Conditions)

Mr. Martin J. O'Neill: I have given you notice of my point of order, Mr. Speaker. In view of the blizzards which are hitting the northern part of the country, and Scotland in particular, would it be possible for you to use your good offices with the Leader of the House to ensure that the Secretary of State for Scotland will make a clear statement in the House as soon as possible about what is happening and the damage that is being done?

Mr. Speaker: I shall not need to use my good offices, as the Leader of the House and the Secretary of State for Scotland are both present.

Mr. Bill Walker: For your information, Mr. Speaker, I should like to say that the police and rescue services in my constituency, which has been badly hit, have kept me fully in the picture.

Questions to Ministers

Mr. Gavin Strang: On a point of order, Mr. Speaker. You kindly advised the House last week that when an hon. Member had a question on the Order Paper his prospects of being called to put a supplementary question were enhanced. If an hon. Member puts a supplementary question at Question Time, are his chances of asking a question on a statement reduced?

Mr. Speaker: That might seem to be an impertinent suggestion. Let us leave it at that.

STATUTORY INSTRUMENTS, &c.

Ordered,
That the draft Grants to Redundant Churches Fund Order 1984 be referred to a Standing Committee on Statutory Instruments, &amp;c.—[Mr. Garel-Jones.]

Multi-Occupied Properties (Regulation)

Mr. Michael Meadowcroft: I beg to move,
That leave be given to bring in a Bill to provide for the regulation of multi-occupied properties by preventing statutory undertakers from installing multiple outlets without having established that there is valid planning permission for multiple occupation.
The Bill seeks to deal with a small but important nuisance which often causes severe dissatisfaction and problems for neighbours, especially in the cities. Fortunately, most landlords and developers follow the law. They apply for planning permission and obey the requirements of the law in respect of conversions to properties. However, a few landlords and developers do not do so. When they convert properties into multi-occupation, they do not seek for planning permission. In those circumstances, if the property is such that it cannot be conveniently converted, severe problems can arise for the owners or tenants of adjoining properties.
In Yorkshire and other areas in the north there are many terraced properties, including back-to-back properties. If a bedroom in one house adjoins a living room in the house next door or the house to the rear, and people quite legitimately play music in that living room until a late hour of the night, a nuisance can occur, and the question then arises whether the planning laws have been or could have been applied.
I do not seek to inhibit appropriate conversion of dwellings into bedsitters or flatlets. There is a need, and a demand, for more accommodation for single people. However, there are a few unscrupulous people who go ahead with conversions in the belief that they will be able to get away with it. That causes a severe problem for those who have to enforce the law on multi-occupation.
Many local outhorities are reluctant to enter into enforcement procedures, not only because they are excessively long drawn out, but because there is the great problem of proving that the alleged action has taken place. The companies tend to be off-the-shelf companies which regularly change their directors. It has to be proved that the dwellings are intended for multi-occupation and will not have a central core of facilities serving the rooms to be let.
The authorities have not been able to apply the law properly because the legislation has tended to consider the problem from the wrong end of a telescope. The procedure has been to try to enforce the law after the conversion has taken place rather than in advance.
If a landlord is to be able to let units in a property intended for multi-occupation, gas, water and electricity must be available in the units. Neighbours facing the difficulties of noise and nuisance are always puzzled by the fact that the statutory undertakers appear to connive at an illegality. In fact, the statutory undertakers have no choice in the matter. As the law stands, if a demand is

made for services, they must be supplied. To those who complain to their elected representatives, it appears that one part of the state is conniving at undermining the power of another part.
The Bill would prevent developers from demanding a supply of gas or electricity unless they can show to the statutory undertakers that they have valid planning permission or a letter from the planning authority stating that planning permission is not required.
There would be no problem with new-build properties. Anyone building a new house has to have planning permission for the site and to go through the proper procedures well in advance. The Bill would not apply, either, to a simple change of user. It would apply only where someone was asking for a new supply of services to parts of a house. Those are the only circumstances in which the Bill would be needed.
The problem is not widespread. The Leeds manager of the Yorkshire electricity board estimates, roughly, that there are only about 300 demands for such a service in a year. No doubt a number of those 300 already conform to the law. I am anxious that those applying for services in such cases should be on the same footing as anyone applying for a motor vehicle licence. When I apply for a new disc for my vehicle, I have to show that I have the relevant legal papers that entitle me to drive, an insurance certificate and a test certificate. Someone applying for services in such a case should have to go through similar procedures. All that is required is a simple amendment to the Gas and Electricity Acts, and that is what my Bill would provide.
This is not a partisan issue in my own local authority. When a landlord or developer has clearly sought to abuse the law and the local authority has decided to embark on enforcement proceedings — and in some cases it has taken two years to abate the nuisance — the local authority's action has been supported by all three parties on the council.
I am suggesting an easy way of solving a problem which is a nuisance to a handful of people. It will bring some relief to those who have suffered because some landlords of terraced and back-to-back properties seek to abuse the law.

Question put and agreed to.

Bill ordered to be brought in by Mr. Michael Meadowcroft, Mr. Paddy Ashdown, Mr. John Cartwright, Mr. Derek Fatchett, Mr. Geraint Howells, Mr. Simon Hughes, Mr. Archie Kirkwood and Mr. Merlyn Rees.

MULTI-OCCUPIED PROPERTIES (REGULATION)

Mr. Michael Meadowcroft accordingly presented a Bill to provide for the regulation of multi-occupied properties by preventing statutory undertakers from installing multiple outlets without having established that there is valid planning permission for multiple occupation: And the same was read the First time; and ordered to be read a Second time upon Friday 16 March and to be printed. [Bill 85.]

Opposition Day

[6TH ALLOTTED DAY]

Scott Lithgow (Britoil Contract)

Mr. Donald Dewar: I beg to move,
That this House, recognising the central importance of the Britoil contract with British Shipbuilders to the United Kingdom's future in North Sea technology and the devastating effect on the Lower Clyde of Scott Lithgow's loss of this contract, condemns the offensive and unworthy attempts by Ministers to divert attention from their own lamentable inaction by blaming the present disaster on the work force alone; calls for an immediate halt to their unjustified attacks on the nation's ability to carry out the contract which can only damage this country's credibility and encourage our competitors abroad; and taking account of the growing evidence that the cost of cancellation to the taxpayer will be significantly higher than the cost of re-negotiating the contract, demands that immediate steps be taken by the Government to secure the future of the Yard and to ensure that the Britoil contract is completed at Scott Lithgow.
As we look around Scotland, there are problems aplenty. As we watch what is virtually the destruction of our economic base, only the most gullible person would now believe the rather complacent talk about economic recovery that we heard only a few weeks ago. Even against that background, and against the many problems, I believe that we are correct this afternoon to concentrate upon the crisis of the Scott Lithgow yard. It is unusual because it is not a case where jobs are at risk because there is no work or no order. There is a customer and there is work ready to be done. We have a dispute between a company that is 100 per cent. owned by the public sector and one that is 48 per cent. owned by the public sector. Yet we have an appalling position where the venture is bidding to end in disaster and the whole thing to collapse in a welter of writs. What is the point in allowing that to continue?
There are a number of reasons why I believe that it is essential that the Ministers intervene and take some action to try to find an immediate solution. The first and obvious point that I make is the impact on Greenock and Port Glasgow. My hon. Friend the Member for Greenock and Port Glasgow (Dr. Godman) has worked extraordinarily hard during the crisis and will no doubt be speaking about it in a minute or two.
It will be known to many hon. Members that about 94 or 95 per cent. of the work force lives in the Greenock and Port Glasgow area, where male unemployment is already touching 20 per cent. If we are to lose 4,000 jobs directly, which I fear will be the result of the cancellation of the contract, if the disaster were allowed to run its course, the total might rise to 8,000 or more. It does not affect only Scott Lithgow. All the subcontractors are at risk. There is Motherwell Bridge, and UIE on the upper Clyde, a company that has fought particularly hard to keep itself afloat and which has been rightly much praised by successive Governments for doing so. There will be an impact not just upon the town but on the area, the region and the Scottish economy.
The second pressing argument that I urge upon Ministers is that, if we scrap this contract and allow it to go down, we are, in effect, scrambling out of the key area of North sea technology. This is not a standard rig. It represents a new frontier—a cliché which, for once, I

believe is justified — dynamically positioned and operating in deep water. It is the type of rig that will become increasingly important as conventional oil reserves are depleted and as we have to push into wilder
The third reason is that I believe—I cannot put it higher than a belief which I think should be put to the Minister—that there is a strong case that the public purse would be saved money if we were to continue and complete the contract, as against the formidable costs of cancellation.
I recognise all the difficulties of doing the calculations and computations. However, Professor Pickett, a professor at Strathclyde, has studied the costs of cancellation, the repayment of the stage payments, redundancy payments, tax losses, supplementary benefit and even the rate loss to the local authority. He believes, after the realisation of assets, that the cost of cancellation will be close to £100 million. He believes that the cost of completion will be some £20 million less. That is based not upon an optimistic assumption but upon the pessimistic one that there will be redundancies anyway in early 1986 when the rig is completed which, we hope, would be avoidable if we could continue with the work.
Professor Pickett is not alone. The Engineers and Managers Association and a number of other people have all come to the same broad conclusion. I do not stand on any set of figures. I cannot do so or offer my expertise. I believe that there is a case and that it must be rebutted if Ministers are to continue to take the negative attitude that they have displayed so depressingly during the long weeks of crisis.
I remind the Secretary of State—I am sure that he is aware of it—that the British Shipbuilders accounts for 1982–83 show that a fearsome loss of over £60 million is recorded against Scott Lithgow's name. However, if he reads the small print, he will see that the amount includes a substantial figure for future provision. We know from what the Minister of State, Department of Trade and Industry told the House on 20 December 1983 that the part of that future provision which is credited to the Britoil contract is £43·8 million.
If one takes the computations that have been made and puts them against the cost of completion, there has already been the provision, from which British Shipbuilders cannot escape, of £43·8 million. That seems to underline the type of arguments that have been put forward in a number of quarters. We are entitled to say that we want to know whether the Government have any figures of their own. We want to know what groundwork and preparations were made by the Scottish Office and the Department of Trade and Industry before it was decided that they would wash their hands of this rig contract and, effectively we fear, of Scott Lithgow.
The Secretary of State has talked about this matter in public. I heard him on the broadcast programme "7 Days" on Sunday. He opened with a slight sneer at Professor Pickett on the ground that he was a gentleman who was known to have been connected with political parties. Very well, if we take that view we shall be leaving a great many people out of the calculations.
In response to a letter from me dated 22 December, the Secretary of State wrote on 19 January and informed me that he did not believe that it was possible to produce the kind of balance of figures that I had requested. What I find remarkably significant is:


But the comparative analysis which you suggest cannot realistically be undertaken, because the costs of the 'renegotiation option' cannot be estimated with any degree of confidence.
I believe that that statement can be challenged, but if we consider it solely on the renegotiation option — the Minister is not disputing in that reply that it would be possible to calculate the costs of cancellation — we cannot shrug the question off. There must be costings, estimates and balances struck. It is a damned disgrace if they have not been struck by his civil servants or colleagues. The House has a duty to demand to see the figures and to demand an explanation for their absence if they cannot be produced.
There is a great deal of suspicion about the way in which the Government and British Shipbuilders have approached the problem. It is a suspicion that has been reinforced—I do not wish to dwell upon this at great length—by the somewhat offensive attitude with which the matter has been dealt.
I hesitate to suggest—I hope that there will be no justification for such a suggestion—that a decision was taken deliberately as a matter of policy that closure should be allowed to happen. What is clear, and what I am trying to deduce from the facts, is that Ministers must have seen disaster looming and, having leverage and influence, they took no action to avert it.
We received a series of embittering speeches in which the work force was cast as the sole scapegoat for the trouble. We saw an example of what I would describe as the Admiral Byng approach to politics. We were left with the impression that 4,000 summary executions on the lower Clyde would do a mighty lot to encourage others to concentrate upon the benefits of Conservative policy for British industry.
We were told, inevitably, that Scott Lithgow's wounds were self-inflicted and that those responsible must accept the consequences. It was to be a cautionary tale. We are entitled to protest about that callous and inadequate approach and the excess with which it was argued.
I objected very much to the fact that the Minister of State, Department of Trade and Industry, speaking in the House on 20 December, cast doubts upon the views of the Archbishop of Glasgow about the social consequences of the catastrophe. Those were entirely relevant and a factor that should have been taken into account, together with the fears of many others.
The Minister's chief, the Secretary of State for Trade and Industry, referred in the most slighting way to "malevolent ninnies" when talking of those trying to come to the aid of Scott Lithgow. We also heard his now notorious remarks on the wireless when he compared the failure of the lower Clyde work force to measure up to work completed by people taken straight from the paddy fields of Korea.
I concede, as everyone would concede, that there have been problems in the yard and that the work force must take its share of responsibility, as must everyone else. Sir Robert Atkinson wrote a remarkably confused letter to the Financial Times attacking the work force. He said that there had been much progress in the past 18 months and that Scott Lithgow was near success. If he is right about that—I merely give his opinion that the yard is near success—it is doubly tragic that the yard should slip away, as it has been allowed to do.
It is clear that the contract, with its narrow time constraints and unrealistic expectations, was negotiated by British Shipbuilders' top management at board room level. Those managers sat and watched the failures of both system and management that allowed the company to drift to disaster, but they were unable or unwilling to intervene. It is not very helpful to spend time going over the past, but this is a real crisis. The House is entitled to ask the Secretary of State, the Department of Trade and Industry or the Scottish Office how they intend to proceed and what can be done to help.
One of the most alarming and depressing things that I have read for a long time is the Government amendment on the Order Paper. [HON. MEMBERS: "Shocking".] My hon. Friends say that it is shocking and disgraceful. Those words are not used lightly but have the full force of anger. The Government amendment shows an unyielding and dogmatic approach that is indefensible given the problems that we face. I can almost hear the coffin lid being slammed and nailed down, after the amendment was tabled.
The amendment asks the House to "deplore any moves" to resolve the dispute. Two public sector companies are fighting in the courts like Kilkenny cats, and public money is disappearing like snow from a dyke. Thousands of men are being sent down the road to join the dole queues, yet the House is being invited to consider the proposition that the Government have no cause to intervene and should not intervene as a matter of principle. It is a disgrace and a shame that such an amendment should be proposed by the Conservative Government. That is like the rescue services in the north of Scotland refusing to go up into the hills to look for lost climbers, on the grounds that it was their own blooming fault that they went there in the first place.
I say seriously to the Minister that it is common sense and humanity to intervene. If Ministers stand pat on the line presented in the amendment, they show a combination of prejudice and insensitivity that should rule them out for serious further consideration as Members of the House by the electors of Scotland.
It is extremely sad to see the Secretary of State's name on the Order Paper. I hope that he is feeling uncomfortable and embarrassed. The Secretary of State might take it as a compliment that there were some signs of a plea of mitigation on his behalf in the letter to the Financial Times of 19 January. Sir Robert Atkinson said in his letter that renegotiation was not practicable because Britoil had lost confidence in the ability of British Shipbuilders and the chairman of British Shipbuilders, Mr. Day, had made it clear that renegotiation of the contract was contrary to the best interests of the organisation. To be fair to the right hon. Gentleman, Sir Robert did not say that he would not want to intervene as a matter of principle in any event, but that is a spirit of the Government amendment.
I hope that the Secretary of State will make his position clear. If, as I suspect, his position is still as it was in his recent letter to me, I hope that he will recognise that he is in an impossible position, trapped by a harsh and unyielding amendment. The honourable thing for the Secretary of State to do is to resign.
One thing is absolutely clear. No negotiations are taking place. We are being invited to watch the collapse of Scott Lithgow. We are being asked to be party to the national humiliation of watching one of our principal customers, Britoil, which is 48 per cent. state owned, either going to the far east or going for another option that


is manifestly unsatisfactory and will handicap it in North sea oil technology. That will give pleasure only to our competitors and to those taken from the paddy fields to whom the Minister so slightingly referred.
I should like to know what the Government's current position is and what they are trying to do. Is there now a scramble for a private buyer? In the last sentence of the letter of 19 January, the Minister says:
We must now concentrate our efforts on finding a new operator who can make a fresh start.
Is the Minister trying to find such an operator within the time scale that will allow a fresh start on this contract, or has he written off the contract altogether? Is it to be Trafalgar House, which, I understand, sent representatives to the yard this week? Is it to be Götaverken Arendal, the Swedish outfit? Is it to be the unnamed buyer to whom Sir Robert Atkinson refers in his letter? What is to be the cost to the taxpayer? How many jobs will be lost? The Secretary of State recently used the word "trawling" in a broadcast. How long will that trawling take? Some of us have bitter memories of a similar exercise over the Invergordon smelter. We were told that there was a short list of six, which disappeared to a short list of none and the inevitable, embittering closure.
I am sure that the Secretary of State appreciates the practical force of the argument that there is a problem about privatisation, however attractive it is to him. Britoil, whoever it has spoken to, has made clear one fact. It is that Britoil is talking about a time slot of four, perhaps five, weeks before it takes irrevocable decisions to commit the organisation to solutions apart from the contract with Scott Lithgow. I do not believe—I may be wrong—even on the most optimistic assumptions, that it would be possible to get together a private consortium that could rescue the contract within that time scale. That is the basis of our belief that the preferred and right solution, probably the only practical solution, is the renegotiation of the contract between British Shipbuilders and Britoil.
I make it clear that we shall, of course, look at anything that will save the yard and the jobs. However, I urge upon the Minister that even at this twelfth hour, if he got the parties together, used his influence and leverage and took the situation and perhaps individuals by the scruff of the neck, as someone who, as a Minister, has such a large holding in both companies, we could still make the progress that is so badly needed. The Government set the external financing limit of British Shipbuilders. The Government fund that deficit. It is no time for pussyfooting around, talking about insubstantial possible rescue operations or the economic theories promulgated by the Adam Smith Institute. If it makes sense for a third party to come in, it must also make sense for British Shipbuilders to get on with the job and complete the contract. Admittedly, large losses have piled up. British Shipbuilders will have to meet them anyway. It cannot escape from that accumulated debt. Therefore, both would start at the same point. If one makes sense, so does the other. The British Shipbuilders option has the enormous advantage of being able to prevent the catastrophe that is looming on the lower Clyde.
I want a promise and an undertaking of action from the Secretary of State. We are not talking for a narrow, sectional interest in Scotland. There is an enormous range of public support. It has been reflected recently in the

press. I am grateful to the press for the way in which it has carried on the argument and given the public the information that they need to form judgments. Everyone is alarmed and distressed about the way in which this matter has been allowed to drift. Probably for the first time in my life, I shall quote from the Sunday Post. Perhaps that is the unkindest cut of all to the Secretary of State. This weekend it said:
Scotland stands at the crossroads. And the Scott Lithgow yard is the key.
The Sunday Post argues that if we did not save Scott Lithgow and that if we gave ground, soon Ravenscraig, Bathgate and other places would be affected. The article went on to say that it is the bounden duty of the Secretary of State to find a solution
For Port Glasgow and Greenock's sake. For Scotland's sake.
That is absolutely right. The Secretary of State for Scotland must not be a professional mourner who presides over the death of Scottish industry. We are facing a tragedy and a blow to our credibility as a force in engineering technology. We cannot afford to have Ministers who are prepared to sit and watch it happen. The worst aspect of this whole miserable business is not that the Secretary of State and his colleagues have failed but that they have not even tried. That is what will not do. That is what is utterly unforgivable. No doubt many people are at fault, but now we have come to the bitter bit. We have come to the crisis for the yard and for the area. All we have had is an apology for the type of fight which the crisis demands and which Scotland deserves. We believe genuinely and fiercely that, if the Government would act with energy, courage and initiative, we could save the contract, the yard, the jobs and our place in North sea industry. If the right hon. Gentleman is not prepared to do it and to get his colleagues to do it, he should go, and go now.

Several Hon. Members: rose—

Mr. Deputy Speaker (Mr. Paul Dean): Mr. Speaker has selected the amendment in the name of the Prime Minister.

The Secretary of State for Scotland (Mr. George Younger): I beg to move, to leave out from "House" to the end of the Question and to add instead thereof the amendment on the Order Paper. [HON. MEMBERS: "Read it."]
I do not doubt for one moment the anxiety of the hon. Member for Glasgow, Garscadden (Mr. Dewar) on this matter. Nor do I doubt his wish to do anything that he can to help matters be resolved now. However, he gave himself away in some of the ways in which he put his case. It is as if he has been asleep for the past two or three years while the problem has been building up.
The hon. Gentleman gave himself away in two interesting passages. First, without any qualification and without putting the matter into perspective, he described what he called the destruction of the economic base of Scotland. If he had been around and had been observing what had been going on for the past five years, he would have had a great deal more to say about that than was contained in his throw-away line. He tried to make out that the only thing that is happening in Scotland is this extremely difficult problem on the lower Clyde.
Secondly, the hon. Gentleman completely devalued his case when he likened the problem to whether the rescue services should go out in the snows of Scotland. That is an utterly trivial way in which to describe what is by any standards an extremely serious problem. The hon. Gentleman demonstrated deep anxiety about the matter but showed virtually no knowledge of what has been happening and the cause of the problem. He also showed that he has virtually no knowledge of the realities of a big industry such as this when contracts are made and it is attempted to complete them on time.
I am grateful for this opportunity to put into perspective what has happened and to give as good an account as I can of what can be done from now on. The problem is of the greatest concern to everyone in the yard and people in the Inverclyde area. I entirely agree with the hon. Gentleman in that regard. I have been aware of, anxious about and taking action on this problem for a long time—for at least a year. By any standards, the problem is serious. It is also extremely unusual. It is not, as many others have been, a crisis that has come upon us by surprise. On the contrary, everyone involved has or should have seen this coming along a long time ago. That is why tremendous efforts have been made for a year or more to avert the crisis.
As long ago as December 1982 Britoil, the customer, had grave doubts about whether the contract would be completed. It made that clear to Scott Lithgow. Throughout 1983 intensive discussions continued, right up to chairmen level, between the customer and the supplier in an effort to sort out the difficulties. The contract had been entered into freely by two willing parties in an industrial and commercial context. I and my colleagues in the Government were also extremely worried and we thus continued to approve the funding by British Shipbuilders of the huge and growing losses on the contract to give all concerned every chance to get the contract back on the rails. At the same time, repeated and well-publicised warnings were given in the hope that those concerned at every level in Scott Lithgow would understand the nature and seriousness of the crisis and respond.
As long ago as December 1981 I wrote to the chairman of British Shipbuilders expressing my concern about the appalling absenteeism record at that time at Scott Lithgow, and last April, at a large meeting with local representatives and shop stewards from the yard, I warned that there was a danger of the yard closing if it could not improve its performance. That warning was not directed solely at the work force. It was intended to be heard and heeded by all who had an interest in the future of the yard—owners, managers and workers.
Nor was I by any means the only one who gave such warnings from spring 1983 onwards. The then chairman of British Shipbuilders, Sir Robert Atkinson, spoke out with such bluntness that he was criticised by some people for being unnecessarily frank. My hon. Friends the Under-Secretary of State for Trade and Industry and the Minister of State, Department of Trade and Industry, my right hon. Friends the Member for Hertsmere (Mr. Parkinson) and the Secretary of State for Trade and Industry and, more recently, my hon. Friend the Under-Secretary of State for Scotland who has responsibility for industry and education in the Scottish Office are all clearly on record warning about this contract. Ever since he took over at British Shipbuilders this summer, Mr. Graham Day has also spoken out on the matter.
Against that background there was a deafening silence from one vitally important source—the Opposition and their trade union allies, and especially from the hon. Member for Garscadden and his colleagues. I can find no record of any warning or leadership from them at any point in this sorry tale. Indeed, the only statements that they made criticised the warnings which were so correctly being given by many others. They thus weakened the effect of such warnings and encouraged those who were determined to resist changes in working practices which were and are crucial to restoring the customer's confidence in the yard's ability to deliver the contract.

Mr. Dennis Skinner: rose—

Mr. Younger: No one suggests that such changes could be made overnight or that they would have miraculously produced the rig on time, but a commitment to sign the survival package with enthusiasm and conviction was the crucial missing factor which finally destroyed confidence.

Mr. John Maxton: Will the right hon. Gentleman give way?

Mr. Younger: I must press on, as many right hon. and hon. Members wish to speak.

Mr. George Foulkes: This is a debate, not a monologue.

Mr. Younger: Nor did the hon. Member for Garscadden utter a word to urge Scott Lithgow workers to refuse to go on strike during December 1983. That was unworthy of him. The Opposition claim to have influence in these matters. I am sure that they have, but on this occasion, whether through neglect or lack of courage, or both, they refused point blank to use that influence and they bear a heavy responsibility for aiding and abetting the disaster that has followed.
The present crisis has been brought about by Britoil's decision to cancel its contract, but Opposition Members must recognise that the future of the yard is in jeopardy not simply because of its performance on this one contract but because of late deliveries and enormous losses over many years. I realise, of course, the difficulties in the development of the advanced technology involved in the building of this semi-submersible rig for Britoil, but, however sophisticated the technology involved in such a contract, it is no good proceeding with such enterprises if they cannot be brought through into successful completion and profit. The price of learning cannot be met indefinitely. Scott Lithgow undertook to complete this contract at a certain price and by a specified date. It had no need to do so if it thought that it was unable to perform it. It has failed to do so and the customer has judged it accordingly.
If the yard had had a good record previously, there might be more to the argument that the performance of the Britoil contract should be excused because the rig concerned is so advanced technologically. But sadly the performance on other contracts—some of which, such as the BP tanker British Spirit, were very far from being on the frontier of new technology—has also been poor. For example, the loss on the British Spirit of £26·6 million actually exceeded the contract price of £23·4 million. The present rig under completion by Scott Lithgow, which is identical to the one delivered on time and within budget


to the same company, is already 12 months late, and the company is paying a penalty of £20,000 per day throughout the 12-month period.

Mr. Skinner: As the Minister has gone to great lengths to tell us about the relevant contract, will he also remember that his Government awarded another contract to a Swedish firm to build prefabricated units for the Falkland Islands? We have just heard the results of that contract. Despite the fact that the Swedish company did not produce the lowest tender, the price has shot up to £130,000 for each house. The British taxpayers, whom the Minister and his hon. Friends are always going on about, will have to foot the bill. I am more concerned, representing an English constituency, to ensure that my Scottish colleagues are kept in work, rather than those in Sweden who are being kept in work by such an inflated Government contract. Will the Minister give a guarantee that the Swedish firm will be crossed off the Department's list?

Mr. Younger: If the hon. Gentleman wishes to raise that matter with the appropriate Minister, I am sure that he will do so. If he will allow us in Scotland to consider seriously our problems, he can take his time to raise his questions elsewhere.
The Opposition demand that, notwithstanding that record, the Government should intervene in the contractual—

Mr. Norman Buchan: The Minister has painted a dismal picture of a yard which, until the time of the appointment of the present management, had been one of the most successful in Scotland, The Minister is a member of the Government. As failures have come about since the Government took office, with the same work force, shop stewards and junior management, but with a different top management for which the Minister is responsible, why did he not sack the top management and put in people who could work the yard? Britoil was, apparently, satisfied with what it saw in the labour force.

Mr. Younger: The hon. Gentleman is being remarkably frank in making a comparison between the former and present managements. Perhaps he should have thought about that before he and his colleagues put through the changes that led Scott Lithgow into its present position.
The Opposition's demand is that the Government should intervene in what was a contractual, and is now a legal, dispute between British Shipbuilders and Britoil and secure the renegotiation of the contract for hull 2002. Even if the issue were only one of finance the Government would find it extremely difficult to justify further support for a yard which has already been such a heavy burden on the taxpayer, but there are other considerations, not least the attitude of the parties to the contract.
The chairman of British Shipbuilders has made it clear that renegotiation would be prejudicial to the interests of British Shipbuilders as a whole. Britoil, for its part, made clear as long ago as December 1982 its serious doubts about the rate of progress on the contract. Its present position is that, although it is ready to consider any specific proposals for completion of the rig, it has lost confidence in the commitment of Scott Lithgow to do this on satisfactory terms.
The Government are accordingly asked to bring not one but two unwilling parties to the negotiating table. I have heard the argument that, despite that, the Government have a responsibility, because they own British Shipbuilders and have a significant stake—albeit a minority one—in Britoil to knock the heads of the two parties together. I reject this suggestion entirely. The future of the contract is a matter between the two parties in which it would be quite wrong, and indeed damaging, for Ministers to try to intervene.

Mr. Dewar: I do not wish to use information obtained in private conversations, but, having talked to senior management at Britoil—and others have had a similar experience—my impression is that it would be prepared to examine a renegotiation offer. It wanted someone to come forward with proposals, and if they were financially practical it would be prepared to consider a renegotiated settlement which would enable the rig to be completed in the yard under the auspices of British Shipbuilders.
Mr. Graham Day of British Shipbuilders has said many times that his basic position is that renegotiation will cost money and he does not have any. He is in trouble with his external financing limit and has no room for manoeuvre. The Government have an interest in this matter because they own large slices of the equity—in one case, 100 per cent.—and they will have to fund the aftermath of the disaster. That is of wider public interest, which overrides a narrow view of the sanctity of contract.

Mr. Younger: I do not agree with either points made by the hon. Gentleman. I have seen the chairmen of British Shipbuilders and Britoil individually. The hon. Gentleman may or may not have noticed that the chairman of British Shipbuilders made his position quite clear, and did so for good measure on television a few days ago, when he said, having given a catalogue of what led up to the present position:
Those are the reasons why I have not asked the Government for money to renegotiate this contract.
I also saw the chairman of Britoil recently, whose position is exactly as I have said. Although he wishes, as we all do, to get the rig completed if possible on the lower Clyde, he does not regard as a likely option the renegotiation of the present contract under the auspices of the present parties. [Interruption.]

Mr. Gavin Strang: rose—

Mr. Deputy Speaker: Order. Is the Minister giving way?

Mr. Bruce Millan: Somebody is telling lies.

Mr. Younger: I give way to the hon. Member for Edinburgh, East (Mr. Strang).

Mr. Strang: The Secretary of State referred to the financial cost. Have the Government estimated the financial cost to them of the additional unemployment that would arise from the closure of Scott Lithgow, or will Scott Lithgow follow Chrysler and British Aluminium without any estimate being made of whether or not it would be cheaper for the Government to keep the yard open?

Mr. Younger: I appreciate the hon. Gentleman's concern. I should not have given way, as I shall deal with that point later. I hope that hon. Gentlemen will allow me


to proceed to the end of my speech as quickly as possible, as many hon. Members who have constituency interests wish to speak.
A further argument is that the Government should intervene because, it is claimed, it would be cheaper to renegotiate the contract than to cancel it. Various estimates purporting to support that conclusion have been referred to in the press and elsewhere. One feature of the estimates is that they vary enormously. I recognise the interest in the question of comparative costs, and I do not criticise those who have made an honest attempt to assess the position, but their problem is that they have no access to the essential information. Moreover, this information is, and is bound to be, commercially confidential and, what is more, is the subject of litigation between British Shipbuilders and Britoil. It would be wrong of any hon. Member to prejudice such legal action by bandying about all sorts of figures.
I have been anxious—[Interruption.] I do not know whether the hon. Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes) wishes to hear any more of the argument. If he does I should be delighted, but if he does not perhaps he would allow the remainder of the House at least to hear the debate. One does not have to agree with something to be prepared to listen to it. Perhaps the hon. Gentleman would reflect on that.
I have been anxious to establish the general position on costs. British Shipbuilders, which is the organisation best placed to estimate the cost of renegotiation, has assured me that, even without taking into account the potential knock-on effect on other British Shipbuilders' contracts, acceptance of cancellation is the significantly cheaper and commercially justified option.
But let us for a moment speculate on what would have happened if the Government had been foolish enough to take the advice of Opposition Members and had intervened and secured the renegotiation of the Britoil contract. For a start, that would have been to fall into the trap of encouraging the belief that the Government are always there to bail out a nationalised industry from difficulties in which it finds itself as a result of failing to produce the goods on a commercial contract entered into freely by both sides. That is the seemingly easy course which has led to so many of the problems with which we are having to grapple today.
It is not a course—[Interruption.] Perhaps the hon. Member for Carrick, Cumnock and Doon Valley will give me credit for at least looking to all sources for advice and making sure that I am fully advised from all quarters. It is not a course which appeared to commend itself to the Opposition when they were in Government. I shall quote an authority which none of them can dispute, the then Minister of State, Department of Industry, the right hon. Member for Manchester, Gorton (Mr. Kaufman), who said in the debate on the Shipbuilding Industry (Assistance) Bill:
It would be foolish to bail out yards that are not able to meet pricing and delivery criteria."—[Official Report, 24 February 1977; Vol. 926, c. 1655.]
If that is put against the attack on the position of the Government on this contract, there could not be a more damning indictment of the two voices with which the Opposition are prepared to speak both in and out of office. There could not be a more apt description of the circumstances at Scott Lithgow. It would have meant accepting a completely open-ended financial commitment

—virtually writing a blank cheque-as we had no idea how long the contract would take to complete or whether the yard would ever win a further order. It is clear from. my discussions with oil companies that the yard. as presently organised, has lost customer confidence so completely that the prospect of its obtaining any further orders is remote, to say the least.
Intervention in the commercial and legal issues currently in dispute between the two parties is not the course. The role of the Government is not to try to change the commercial realities. We must concentrate our efforts on two main tasks. The first and most immediate is that of finding a new operator who can make a new start at Port Glasgow. That task will not be easy, especially in view of the history of Scott Lithgow, but it has been achieved elsewhere on the Clyde. I and my colleagues are doing all that we can to assist the chairman of British Shipbuilders in his efforts to find a private buyer. It is a task on which the chairman of British Shipbuilders has already embarked and which British Shipbuilders, as owner of the assets, is best placed to undertake. My colleagues and I are doing all that we can to assist.
We are agreed on the importance of maintaining our skills and the capacity of the yard in the offshore business, but it must be a profit-making operation. That will require a major change in attitudes, in methods of work and in management. Obviously, the attitude of the customer for the partly completed rig is immensely important to any takeover operation. It is too early to speculate on the outcome or the attitude of particular companies which might be interested in taking over the Scott Lithgow facilities and completing the Britoil contract, but I recognise the urgency of the position.

Mr. Roy Jenkins: When the Secretary of State talks about a new start at Port Glasgow, does he envisage that being done, under whatever ownership, with the rig completed or abandoned? Does he recognise that if the rig is abandoned all the learning—admittedly very expensive learning, with many mistakes on both sides—will be thrown away and the new start will begin against a background of failure? Unless he can put forward a proposal under which the rig will be completed, under whatever organisation, he owes the House the duty to give more a detailed refutation of the figures which have attracted great publicity and which were put forward by a reputable economic source in Glasgow.

Mr. Younger: I appreciate the right hon. Gentleman's principal point, to which I can respond positively. We envisage that the best prospect of getting some new operation under way is that it should start with the completion of the present rig. If a new operation can gain a track record for itself by successfully completing the rig, that is the best way for the long-term future. But we must recognise that even if a new operator can be found there will still be significant job losses.
That brings me to our important second task. As I have made clear, I am ready to do all that I can to help the local Inverclyde economy. I have already had discussion with the chairman and chief executive of the Scottish Development Agency. In response to an invitation from Inverclyde district council, the Scottish Development Agency has already, with my support, commissioned


consultants to examine the prospects for the area and, in the light of their report, I shall discuss with local interests what remedial action might be taken.
The Government are not prepared to intervene in the dispute between British Shipbuilders and Britoil over the future of the contract, but we accept a responsibility to help in the effort to find a new operator for the yard and to assist the regeneration of the local Inverclyde economy. Irrespective of that, however, as long as hope remains of putting the rig into production, again under a new owner or new management or both, we shall certainly do all we can to facilitate such a deal.
The Government believe that it is very important for the United Kingdom to maintain and develop further our capability in the offshore construction industry, and we certainly do not believe that, as a country with a large presence of the world's highest technology industries, there can be any question of the United Kingdom opting out of the world market for technologically advanced rigs because of some basic deficiency in our skills. I simply do not accept that, when properly motivated and led, workers on the lower Clyde cannot compete successfully with those in any other part of the world.
I and my colleagues in the Government will, as I say, be doing all in our power to assist, but there is a vital element of help which we need from all concerned on the lower Clyde. We need a clear and unequivocal commitment from all who wish to form the work force for this industry in the future. We need an open agreement for new work practices, for flexible shift working and for total co-operation with what will have to be a new and dynamic management team. We need, too, an assurance of no disputes in any circumstances without full use of agreed procedures, and a joint commitment to the customer by all concerned that the work will be delivered on time.
Only in that way can the essential confidence of customers, both present and future, be rebuilt. I am sure that the vast majority of those who work on the lower Clyde would be only too willing to give such undertakings and that they undoubtedly have the skills, when properly used, to out-perform anyone in the world in that field.
For those reasons I ask the House to accept the amendment.

Mr. Bruce Milan: We have just heard a lamentable speech from the Secretary of State, notably full of humbug and hyprocrisy — even by his standards. The fact is that, as events have developed during the past two or three months, it has become increasingly clear that British Shipbuilders decided several months ago that it would close the Scott Lithgow yard, and the Secretary of State and other Ministers have stood back and allowed that to happen. They have connived, and are conniving, at the closure of the yard, and nothing the Secretary of State has said in the latter part of his speech changes that one little bit.
The excuse was to be a very simple one. It was all to be blamed on the work force: the work force had been lazy, it had not co-operated with the management, and the fault for the closure was to be placed squarely on its shoulders. Unfortunately for the Government, it has not turned out to be as easy as that because, as more facts have become available about the history of Scott Lithgow and

the history of this contract, it has become crystal clear that the responsibility for the present mess can be laid in no way exclusively on the shoulders of the work force at Scott Lithgow, and the Government know that.
The work force at one time used to be held up by Conservative Members as an example to workers in other shipyards in other parts of Scotland. It is not true, as Ministers have tried to portray, that the yard has made massive losses over a period of 10 years. Nor is it true that the responsibility for the delay in this contract rests exclusively with the work force. There is some responsibility on the purchaser, Britoil — or, more accurately, Odeco—in this matter in terms of design changes and difficulties in getting decisions about the changes. There is undoubtedly a major responsibility on the management of British Shipbuilders for negotiating the contract initially at the price and on the time scale that it did, given the high technology of the contract. There is, of course, some responsibility on the work force but, as I have said, nothing like the kind of responsibility that the Secretary of State has tried previously, and even today, to place on its shoulders.
The Secretary of State's speech today has taken no account of the recent considerable improvements in productivity in the yard. It has taken no account of the statement by the shop stewards the other day that they are prepared to accept the flexibility arrangements. It has taken no account of the recent statements by the new management of Scott Lithgow that the facilities are first-class and that, given a little opportunity, within months this could be turned into a first-class yard able to compete with any other yard in any other part of the world.
It has become a matter of public recognition in the last few weeks that this is an area of offshore technology that is very demanding, and in which it is important for the country to remain, if anything like the full advantages of North sea oil are to be gained. It has also become clear—and I shall return to this in more detail later—that the costs of cancelling the contract and closing the yard are almost certainly considerably higher than the costs of continuing with the rig and renegotiating the contract.
For those reasons, although the public reaction in Scotland at the beginning of this debacle was rather unsympathetic to the Scott Lithgow work force in particular, I believe there is now the strongest public opinion in Scotland in favour of renegotiation of the contract and completion of the rig at the Scott Lithgow yard. There is now strong public condemnation in Scotland of the inactivity and the unwillingness of the Government to bring that about.
The choice now is between closure and carrying on with the contract and selling off the yard. I shall say something about each of these in turn. On the question of closure, I dare say that, if the Member for the constituency, my hon. Friend the Member for Greenock and Port Glasgow (Dr. Godman) is called later in the debate, as I hope he will be, he will be able to explain the devastating social and economic consequences to the area of closure taking place. This is not just an ordinary closure on a large scale. The work force is concentrated in a particular community, and the effects on that community, which is already devastated by unemployment, would be horrific and catastrophic. It is a disgrace that the Government amendment does not even recognise the social consequences of closure in the area.
Turning to the question of continuation of the contract, I maintain that there has been distortion of the view of Britoil, and that distortion was carried on by the Secretary of State in his speech. He gave the impression that Britoil was not willing to renegotiate the contract with British Shipbuilders. That is not true. I have had it said privately to me, although it has been said also on the public record, by Mr. Ford and Mr. Clark of Britoil that they are anxious to renegotiate the contract with British Shipbuilders. Either they are telling lies, Mr. Deputy Speaker, or someone else is telling lies. [HON. MEMBERS: "Who?"] I say to the right hon. Gentleman in the most categoric terms that Britoil is willing to renegotiate the contract with British Shipbuilders, and the only thing preventing that is the inactivity of the Government and the unwillingness of British Shipbuilders. [HON. MEMBERS: "Answer".] Although the Secretary of State would not give way to me, I shall give way to him, if he wants, but he is sitting on his backside just as he is sitting in inactivity and allowing the catastrophe to happen.

Mr. Younger: I shall try to respond to the right hon. Gentleman. He has been trying to say that Britoil is prepared to revive the present contract. That is not what he said, but it is the impression that he tried to give. Of course Britoil—and I made this clear in my speech—is anxious to get the rig completed, and would be delighted to make a new contract to get that done on the lower Clyde. I made that perfectly clear in my speech, and the right hon. Gentleman has been long enough in the House to know that.

Mr. Millan: The right hon. Gentleman has not contradicted what I have said and, thererefore, what he said earlier in the debate is a complete distortion of the truth, and I stand by that.
British Shipbuilders has taken the formal view that it could still complete the contract on time plus the 300 extra days. I say again categorically that, when British Shipbuilders says that, it does not believe a word of it. British Shipbuilders knows very well that it cannot complete the contract on time plus the 300 extra days. If British Shipbuilders believes that to be some kind of fall—back position in the hope that, should it come to legal action, it will manage to avoid paying back to Britoil the £40 million that it has already received from Britoil, it is advancing a hopeless proposition. It is important to get this on the record because it is relevant to the question of the comparative costs of carrying on with the contract, on the one hand, and seeing it cancelled, on the other. I say in categoric terms that the House has been told by the Government on more than one occasion that, if the contract is cancelled, the £40 million will have to be paid back to Britoil.
What we are discussing here is public money. This is not British Shipbuilders' money but ultimately Government and taxpayers' money. It is scandalous that the Government, who are supposed to look after the public purse, have not taken the slightest step to bring Britoil and British Shipbuilders together. The comparative costs of cancellation as against continuation of the contract have not even been considered by the Government. As it made clear in the letter of the Secretary of State only yesterday, the Government have not even looked into the comparative costs. The Government, who are supposed to be concerned with public expenditure, have not even looked at the

comparative costs of continuation as against cancellation of the contract and Scott Lithgow facing almost certain closure, although they will pay the bill. The Secretary of State's letter has the impertinence to suggest that the matter might be looked at by the Select Committee. If it can be looked at by that Committee, it can be locked at by the Government, and it should have been looked at by them long before now.
I have said previously in the House that, while I am not privy to confidential information, on any reasonable judgment of the situation, based on what is publicly known, it would almost certainly cost more for the contract to be cancelled than to carry it on. Those who have studied the matter and who have a certain amount of information, including Professor Pickett and the Engineers and Management Association, have come to that conclusion. I do not know whether their conclusions are accurate, but we should not need to rely on such sources to have the figures brought out. They should be provided by the Government. Either the Government have the figures and are not telling us, in which case they are treating the House dishonestly, or they have not even bothered to get the figures. I hope that that point will be answered when the Minister replies.
In any case, the matter goes beyond crude cost calculations on a short-term basis. Those of us who represent Scottish industrial constituencies know to our cost that, given redundancy and closure, there is a continuing, not just a short-term, cost. When Linwood was closed down, unemployment benefit was not paid for a few months or a year. It is having to be paid for years afterwards. We have lost manufacturing capacity in the last four years at an unprecedented rate, and that is placing on the economy and taxpayer in financial and other terms a huge burden.
Nor, in terms of crude cost calculations, is the fact taken into account that once capacity is lost, it is never re-established. Indeed, its place is taken not by competing British companies but—this has happened in many cases and will happen in this case—by foreign companies. Scott Lithgow's place will be taken by foreign yards rather than by competing British yards. In other words, the Government are selling jobs in Scotland in favour of jobs overseas—in Korea or elsewhere.
For all those reasons, renegotiation would be the cheapest, most obvious and most direct way of saving both the contract and the Scott Lithgow yard as a whole. To say, as the Government say in the amendment, that they do not interfere in industrial decisions, when they have just increased electricity prices against the wishes of the Electricity Council—and only yesterday we were told that they had intervened even in the sale of the Gleneagles hotel—is humbug and hypocrisy.
In recent days there has been mention of "another buyer" for the Scott Lithgow yard. Indeed, finding a buyer is an important part of Government policy. Although it is not even mentioned in the amendment, we are meant to put all our hopes on finding that buyer. It is a commentary on the so-called patriotic party that while the Secretary of State will not intervene to bring Britoil and British Shipbuilders together, he has sent civil servants scuttling off to Sweden to try to sell off the facility to foreign interests.
We also have the spectacle of Trafalgar House inspecting the yard and being a possible purchaser, arid Trafalgar House is the parent company of Cementation


Limited, which is well favoured by the Government. [HON. MEMBERS: "Cheap."] Despite the protestations of Conservative Members, it happens to be a fact. Lord Matthews does not appear to me to be some sort of fairy godmother who will come in and rescue Scott Lithgow and the jobs there. If we have something to sell at Scott Lithgow, that is an argument for renegotiation and carrying on with the work that is already being done there.
Nor has it been made clear, in response to the intervention of the right hon. Member for Glasgow, Hillhead (Mr. Jenkins), whether the Government will sell the yard on the basis that the contract is completed there or on the basis that it is completed somewhere else. It is absolutely clear, however, that nobody will buy the yard at his expense. It will be at the expense of the public. Anybody with experience of liquidations, bankruptcies and closures — and this Government have more than most—is aware that prospective buyers come in on the basis of picking up property at the cheapest possible price. We can be sure that if anybody comes in to buy the facilities at Scott Lithgow, it will be done ultimately at the expense not of Britoil—why should it be at its expense? — and not at the expense of British Shipbuilders, although that would only be the Government in another hat, but at the expense of the Government.
It cannot be done unless the Government have the cooperation of British Shipbuilders and Britoil. They are not willing to bring those two parties together to save the contract, but they will be willing to bring them together to see that the yard is sold off, perhaps to foreign interests. What a commentary on their industrial policy.
The Government's negotiating position will be the weakest imaginable, particularly as even this afternoon the Secretary of State again lambasted the work force and management at the yard. How can he expect to sell a facility of this kind at a reasonable price when he makes the sort of speech that he made today?
Even at this late stage the only way to have a reasonable prospect of saving the contract and the jobs at Scott Lithgow is to have renegotiation between British Shipbuilders and Britoil. If the Government refuse to intervene to bring that about, they will be guilty of a betrayal of Scottish interests, to be added to all the other betrayals of Scottish and United Kingdom interests that we have suffered under the Conservatives and the Secretary of State for Scotland.

Mrs. Anna McCurley: It is with a sense of regret and disappointment that I cannot support the Government in the amendment. Nor can I support the ravings of embittered and embattled Opposition Members whose total contribution to the solution of the problems of Scott Lithgow so far has been to growl over the real issues and exacerbate some of the problems that we have been discussing in relation to the work force, problems that would never have occurred had they intervened in the past.
Lest any minorities think that they have converted me, let me disabuse them immediately, for until now they have lain like useless flabby jellyfish ready to sting those prepared to put their toes into the political waters and fight. The minority groups have done absolutely nothing until now. Indeed, their only remedy for the situation in

Greenock and Port Glasgow was to hold a meeting, at which they gave themselves a pat on the back, but they have no interest in what is happening in Inverclyde.
Alas, however, the Government amendment is unhelpful and offers nothing to the people of Inverclyde. I sometimes suspect when I see amendments such as this that they come not from the Scottish Office but from somewhere slightly more remote, because this one offers not one crumb of comfort to the people in the difficult circumstances that we are having to endure in Inverclyde.
I am grateful to my right hon. Friend the Secretary of State for Scotland for the interest that he has taken in the area, and I am pleased that the Scottish Development Agency will investigate the potential of Inverclyde, but that is a long-term idea and perhaps 10 or 20 years will pass before anything comes out of it. That is 10 or 20 years away from the loss of jobs that we face immediately.
This is all sad because I believe that the present Government act in the best interests of the British people, and I understand their desire to keep Government influence out of business. What I am looking for now, which I do not see but hope will come out of this debate, is a speedy resolution of the problems of Inverclyde. If this had been happening and boiling up in the Wash over the past few years rather than in Inverclyde, somthing might have been done about it more quickly. The Government have to look at the enormous potential that the lower Clyde has to offer. The Times said of Scott Lithgow:
Lame duck may yet lay a golden egg.
For many years we have suffered a strange sickness in this country, which meant that we were prepared to cave in to our competitors and let them have a clear field. The Government were reversing this trend, especially with their support for the new technology. However, it is a myth to suggest that Scott Lithgow is an archaic, creaking and inefficient shipyard. I know that it has had its difficulties and that it has suffered because of the recession and has found it hard to compete with south-east Asia and Korea. The galling thing for us is that the people who are now working as our competitors were trained at Lithgow's and Scott's. We taught them how to be our competitors.
Scott Lithgow is now at the forefront of the new hydrocarbon technologies. The way that it got there is nothing short of a miracle, considering the appalling lack of understanding about that industry that seems to pervade every level.

Mr. Ernie Ross: Including the hon. Member.

Mrs. McCurley: Are we to hand over this hard-earned skill for the benefit of our competitors without a fight? Scott Lithgow is no stranger to technology success in the offshore market. The yard has an extensive product range, including drill ships, a seabed operations vessel and an emergency support vessel. Until 1980, Scott Lithgow had developed involvement in the offshore market, beginning with the construction of two dynamically positioned drill ships, the Ben Ocean Lancer and the Pacnorse I. Both vessels were designed for and have operated in waters beyond the continental shelf — that is to say, at the depth below the capability of the then generation of drill rigs. The construction of these vessels represented a major step forward for Scott Lithgow in that it gained entry into the technology of dynamic positioning.
Rapid development followed after this, as is shown by the Ministry of Defence seabed operation vessel and the


Iolair, the emergency support vessel built for and operated by Shell. That order was followed by an order for a drill rig for BP Sedco, the rig 2001, and latterly the order for the dynamically positioned drill ship for Lloyds Leasing, the 2002. Scott Lithgow is now working at the foremost frontiers of technology. The rig has been designed to operate in depths of water normally thought to be the exclusive province of drill ships. This rig can be said to represent the first of the third generation of offshore development vessels, the first encompassing the jack-up rigs and the second drill ships and semi-submersible rigs such as the 2001.
Comparison has been made between the semi-submersible rig built in South Korea and the 2002 contract, but the Benrioch was completed in 1983 and is now working in New Zealand. It is wrong, however, to compare this rig with the 2002. The Benrioch represents a typical second generation rig. It is not dynamically positionable and is designed to operate at depths of only 1,500 ft.
The Government should be clear about the past blunders at all levels before their excessive condemnation of Scott Lithgow's work force. After all, it has agreed to the survival plan. However, I wish that the work force had agreed to that survival plan in the summer, when the workers were urged to do so by this Government, for there would now be far more room for manoeuvre.
It is sad to look back on the lower Clyde and see what has happened in the years before and since nationalisation. We have heard about £165 million that has been squandered, but in the four years before nationalisation the only loss on the lower Clyde was £2·4 million, and we were going into profitability. Then nationalisation came along and destroyed our industry. It is exceptionally sad that the Secretary of State should have fallen for the line about the paddy fields. I realise that the position is difficult, and I hope that he will fight for us with the force with which he has fought for other industries.
I have never asked the Government for more direct intervention. I have understood their argument about the Britoil contract and about the precedent that would be established. All I am asking today is for a solution to the problem that will enable the rig to be completed on the lower Clyde, and to find that solution fast. I do not want the same old merry-go-round to take place. That would happen if we were to leave the status quo and renegotiate the contract. The technology is bought and paid for and we have the capability on the lower Clyde.
Let us be clear about the effect on the area. My constituency has a smaller proportion of the work force than that of the hon. Member for Greenock and Port Glasgow (Dr. Godman). Gourock is also involved, as are Wemyss bay, Langbank and Bishopton and all round west Inverclyde. It is not just the white and blue collar workers in the yard who will be affected but the people who have businesses in the towns in this circumscribed area. The livelihoods of these people are at stake, not just the livelihoods of the 4,500 workers at Scott Lithgow. There are the small businesses, the subsidiary companies, the house values and prices, all of which are most important to the people in my constituency. This is why I say what I am saying today. The effect of the closure of Scott Lithgow would be devastation in the area. Some 90 per cent. of the work force comes from Gourock and Greenock and Port Glasgow and there would 40 per cent. unemployment.
Before any hon. Member who does not know the area speaks about it, I point out that the people that I and the hon. Member for Greenock and Port Glasgow represent and whom we are often criticising belong to the same families as the people who work in IBM and National Semi-Conductor and who have a marvellous work record. They are commended the world over. The west of Scotland is becoming part and parcel of the new Silicon Valley technological era because of the work forces in places such as Greenock and Port Glasgow.
We must remember that we owe that area something. During the war, the men — some of whom, or their families, are still in the shipyards—who worked in that shipyard produced a ship every 21 days. We needed their help then, and they need our help now. The cost of failure of Scott Lithgow to the taxpayer is uncertain. The cost of supporting the area is incalculable. Also uncertain is the cost to the United Kingdom of losing the capacity for this high technology in the lower Clyde. Speed of action is the cost saver. The loss of expertise would be an appalling waste. The loss of jobs is also an appalling waste. No one wants to employ the unemployed because, after a certain time, after they have wound down they are not much use. They must be kept in work, otherwise they lose their expertise after a certain time.
What about the solutions? I was a schoolteacher, and I have no experience of big business or industry, but I know that if a school has a good headmaster and a good teaching staff it is disciplined and well run. I believe that that analogy can be applied to industry. So I want a good management and a good work force at Scott Lithgow. Personally, I should like to see Scott Lithgow taken out of British Shipbuilders, because internationally British Shipbuilders is bad news. It is offering no more tenders, and no more orders are on the books.
I should support the Secretary of State for Scotland in an attempt to find a buyer who can complete the rig. However, we must be realistic. Only a limited part of the work force would be involved in the new undertaking, and I am interested in the surplus that would not be involved in that undertaking. It would represent a considerable number of jobs on the lower Clyde. I have asked time and again that we should reconsider the work that we were exceptionally good at and that we completed on time—defence work. The yard can have a future if it is split into the oil-related sector and the conventional sector. Moreover, I see a role here for the SDA, because we need to get other operators into the area, even if only in subcontracting work or in work on components for other parts of the shipbuilding industry.
Essentially, we are talking about this rig. It must be completed. A buyer must be found. The rig must be completed on the lower Clyde. In my opinion, there is a huge future in Inverclyde for the new technologies. It is the only yard in the world that is capable of doing that work at present. We hold the key to Britain's involvement in offshore technology.
May I mention briefly some of the words that were spoken by two of the experts who know the lower Clyde and understand what the Clyde can offer the world. Until four years ago, Mr. Ross Belch was the managing director of Scott Lithgow. He said:
Given the required leadership from management and the necessary co-operation from the workforce, Scott Lithgow and those who work in its establishment could recover their former glory.


I have known the men in the shipyards and the people of Greenock and Port Glasgow since the war. They must now have built up a considerable offshore expertise and it would be tragic if this were lost".
Mr. Willem Kooymans said:
After four months we have made a lot of progress, but unfortunately the performance improvements have not been brought to light.
We have improved in welding by at least 100 per cent. in quality and quantity.
If we get the flexibility that we need we will have a learning curve. If we have that flexibility we can make this a first-class offshore yard in three months".
I remind the work force at Scott Lithgow of those words. In any event, the men there should turn away from their old political masters and think for themselves for a change. After all, their political masters think for themselves alone. One need only think of what happens in other places, where they end up with a job, and the people who run outfits into the ground end up with jobs. They even end up compering television programmes.
Therefore, I ask the work force to accept the challenge of the new order and give us what we are asking for. We are fighting for those men. They have more friends than they realise. I ask them to do everyone in Scotland a favour and make us proud of them again.

Dr. Norman A. Godman: I agree with the hon. Member for Renfrew, West and Inverclyde (Mrs. McCurley) that it is essential for the rig to be completed on the lower Clyde. I emphasise that there is no other yard in the United Kingdom that could build the rig and that at present there is no other offshore yard in the world that is capable of building it. However—here I differ from the hon. Lady—there is an alternative solution, and it is to have the contract renegotiated. That would allow Scott Lithgow to become the market leader in this sector of the international offshore engineering industry. So let us have the rig built on the lower Clyde, and by the present management and the present work force. Since I was elected to this place, I have worked hard with both the management and the work force there in an attempt—modest perhaps, marginal perhaps—to bring about changes.
The case against the Government and British Shipbuilders in this dreadful and sorry affair is a sombre and critical one. It is evident that it would be much more costly to the public purse and the taxpayer to close Scott Lithgow than to renegotiate the Britoil contract. The shipbuilders managers' association argued that it would be five times as costly to close the yard as to renegotiate the contract. I have no doubt that Ministers will dismiss the union's argument, claiming perhaps that it is based on questionable assumptions and disputable facts. However, Ministers appear—we have seen and heard evidence of it this afternoon—somewhat reluctant to produce figures to support their assessment of the circumstances surrounding Scott Lithgow. I have had two meetings with the directors of Britoil, and they are of the firm opinion that they are willing to renegotiate the contract, but they are unwilling to subsidise British Shipbuilders and the Government.
First, I want to deal with the social consequences of closure at this yard. Closure would inflict lasting damage on the whole of Inverclyde. Such social consequences

would be catastrophic for the whole area. Hon. Members should be made aware that this is not just another plant closure. This is not an ailing shipyard experiencing irrevocable decline. It is unique and without precedent. Whilst it is somewhat difficult to make comparisons with closures elsewhere in Scotland, the fact is that 94 per cent., not 90 per cent., of the workers in Scott Lithgow live within the Inverclyde district; only 220 of them live outside Inverclyde. That means that closure would have a massive and profound impact upon the community.
A similar number of redundancies resulted from the demise of Talbot at Linwood, but in that sad case the work force was dispersed more widely over Paisley, Barrhead, Glasgow, north Ayrshire and Clydebank as well as Greenock and Port Glasgow. Here the impact would be dreadful because the work force is confined so narrowly to Inverclyde.

Mr. Buchan: My hon. Friend is right: closure would be horrendous for the lower reaches of the Clyde. It would be even worse precisely because the closure of Talbot has produced much unemployment in the area.

Dr. Godman: I am grateful to my hon. Friend for his remarks. Of course, many of the former Talbot employees are still unemployed. What is so disturbing is the fact that adult male unemployment in the area is already more than 20 per cent. The closure of this yard would almost double that. Redundancies of younger members of the work force would occur at a time when there is very high unemployment among young people. In Port Glasgow youth unemployment is 80 per cent.
An aspect of unemployment that is often ignored, or at best underestimated, is the effect on the families of the unemployed. As 64 per cent. of the work force is aged under 40, it can reasonably be assumed that 2,300 to 2,500 children would be affected directly by closure of the yard. Again, the unemployment figure conceals the real effect of unemployment; it should be multiplied by a factor of about three to include the families. Already in my constituency over 3,000 children receive free dinners.
Because of the concentrated nature of the labour market in Inverclyde, the regional employment trends—perhaps I should say unemployment trends — show that the proportion of the local population who would become dependent on supplementary benefit over the next 12 to 18 months would increase greatly and would be much higher than in other areas, even within Strathclyde.
On top of the social case there is a genuine industrial case to be made for the renegotiation of the contract and the retention of Scott Lithgow. Before commenting on that, I should like to deal with some of the falsehoods, misrepresentations and false descriptions of the recent history of the company and its much-maligned management and work force. Last year the chairman of British Shipbuilders criticised the poor delivery record of Scott Lithgow. A few days later, in reply, Scott Lithgow published a list of nine contracts that had been completed in time over the same period. We did not hear about those from Sir Robert Atkinson, we heard only his complaints. I am pleased that he seems to have undergone a change in his attitude to Scott Lithgow, its management and work force.
The Prime Minister recently criticised the work force. She talked about the record of the yard being abysmal. That ill-informed view is certainly not shared by the


Ministry of Defence. The Royal Navy has consistently praised the fine workmanship of the yard. The most recent testimonial concerned the refit of the submarine HMS Orpheus in 1982. I quote from a letter received by Scott Lithgow from the Royal Navy:
Without exception all who have seen the Orpheus this week have been impressed by the final appearance. She will be a fitting advertisement to Scott Lithgow's capabilities for a long time to come.
Despite that fine display of customer confidence, the Conservative Government withdrew naval work from Scott Lithgow —a political decision and nothing to do with customer confidence.
Following, for some of us, the eagerly awaited retirement of Sir Robert Atkinson, the Government brought in a new chairman, Mr. Day. Some people on the lower Clyde call him the new hit man flown in from Toronto; I think he is from Halifax in Nova Scotia. A good deal of publicity was given to Mr. Day's gross observation that boys from the farms in South Korea had built on time a rig similar to the Britoil 2002 rig. The hon. Member for Renfrew, West and Inverclyde has dealt, rightly, with that criticism of Scott Lithgow. In comparison with the Britoil 2002 rig, the Korean rig is a primitive structure.
Equally repugnant is the malign criticism of poor performance, low-quality work and bad industrial relations which has been used to deflect public support, which is growing in Scotland, and I hope throughout the whole of mainland Britain, for both management and work force in Scott Lithgow.

Mr. Michael Forsyth: rose—

Dr. Godman: No; this is too important a debate.
That criticism was referred to in a recent report published by officials of Strathclyde regional council:
The character assassination of local management and workforce emanating from a number of sources would seem difficult to justify in circumstances in which a number of performance indicators suggest the existence of a progressive and adaptive workforce".
Since early 1982 industrial relations at Scott Lithgow have improved dramatically. In regard to working days lost, disputes, absenteeism, reportable accidents and overtime worked, there have been significant improvements and changes. In the period October to December 1983 there was an improvement of approximately 45 per cent. in productivity and output.
A great deal of false information has been generated by the Government and British Shipbuilders about the refusal of the shop stewards to sign the management's survival plan published in July. Again, the truth is somewhat different. In late September the shop stewards produced their own document entitled "Continuity and change at Scott Lithgow", which outlined the kind of job flexibility they believed would be acceptable to their members. Greenock chamber of commerce said that there was not a great deal of difference between the two sides. I have some experience of shipyard industrial relations. I believe that, given the usual accommodations, agreement would have been reached if the local negotiations had not been overtaken by national negotiations. There was definitely a change in attitude on the part of the work force and the management, and both Government and British Shipbuilders are guilty of concealing and distorting evidence to further their case against Scott Lithgow.
Only two hours ago, I received a telephone call from a senior executive of an international oil company. He told

me that he is livid with British Shipbuilders. He is most anxious to recruit "lots of workers" — that was his phrase—from Scott Lithgow because of their experience and knowledge. It seems that he is being deflected by British Shipbuilders, which claims that the employees at Scott Lithgow are a company asset. I have believed that ever since I became the parliamentary candidate at Greenock and Port Glasgow, let alone its Member.
The industrial case is a powerful one. The rig in question puts Scott Lithgow. with its recent construction programme, on the frontiers of maritime technology. It is not an ailing shipyard which is undergoing continuing and irrevocable decline. Scott Lithgow is at the forefront of this form of maritime technology.

Mr. Michael Forsyth: rose—

Dr. Godman: It is surely time for the Government to promote further the interests of both the shipbuilding industry and the offshore engineering industry. I am reminded of two reports which I saw in the press recently, one in the Daily Telegraph of 18 December. It claimed that the Cabinet had decided that merchant shipbuilding would no longer be regarded as an indispensable strategic industry. That explains to some extent the Government's role. If that is right, it is a policy that contrasts starkly with the position of the South Korean Government, who believe that the shipbuilding and offshore engineering industries are important strategic industries. We have, of course, heard many comparisons drawn between Britain and South Korea.
The Government should follow the lead, despite its confused nature, of Sir Robert Atkinson. In this morning's edition of the Financial Times he states:
The cancellation of the Britoil rig should not be allowed to finalise. It will cause yard closure, probably £200 million or more in cancellation and associated charges; it will damage the Scottish economy and decimate the Lower Clyde. It will also damage Britain's reputation and manufacturing ability, cause the loss of 5,000 jobs and the skills that go with it.
Those engaged in the offshore oil industry are ready to pick up the pieces.
Scott Lithgow is crucial to Greenock and Port Glasgow, and to the rest of Scotland and the whole United Kingdom. On behalf of my constituents and, I believe the people of Scotland, I ask the Secretary of State to follow Sir Robert Atkinson's laudable example, to change his mind and ensure that the Britoil contract is renegotiated.

Mr. Michael Hirst: I am glad to have the opportunity to contribute to the debate. Although I have very few constituents who are employed by Scott Lithgow—

Mr. Ernie Ross: What experience does the hon. Gentleman have of these matters?

Mr. Hirst: I remind the hon. Gentleman that we are here to discuss an important issue. If he chooses to chirp on like a canary, I suggest that he does so outside the Chamber. I have a number of constituents whose jobs and businesses depend upon subcontract work from Scott Lithgow.
My first encounter with the remarkable world of offshore technology was about four and a half years ago when a client of mine — at that time I was in professional practice —came to Scotland and acquired the Marathon shipyard. I was deeply involved in the


professional negotiations, and I take great pride, along with all the others who were involved in them, in having watched a remarkable transformation on the upper Clyde. Marathon was a loss-making, partly state-owned concern. It was inefficient and unproductive and it has been transformed into a profitable yard.

Mr. Dick Douglas: Profitable?

Mr. Hirst: The evidence is available at Companies House if Labour Members want to read the information. It is profitable, efficient and productive. The work force adopted flexible working years ago, not merely months ago. The evidence is there for all to see.

Mr. Dewar: rose—

Mr. Hirst: Two important lessons were learnt from my association with the upper Clyde.

Mr. Harry Ewing: Tell us about UIE.

Mr. Hirst: UIE does not have a full order book because it was undercut by a BS yard, which took the accommodation jack-up rig away from it. I think the evidence will show in the fullness of time that UIE could have completed that rig far more satisfactorily than Cammell Laird, but I hazard that as a personal opinion.
I learnt two important lessons from my involvement with the upper Clyde. The first was that commercial confidence was crucial. Secondly, I learnt that there must be efficient project management so that work can be completed on time and of a quality that a customer will accept. It is a highly demanding market, requiring skills and operational efficiency which were, perhaps, not the order of the day with merchant shipbuilders. At a time when the yards are producing work which is literally at the frontiers of technology, the learning curve associated with the work is enormously important.

Mr. Ernie Ross: rose—

Mr. Hirst: I shall allow the hon. Gentleman to intervene as he has been making so much noise up to now.

Mr. Ernie Ross: What is the hon. Gentleman's actual experience and knowledge of the merchant shipbuilding industry in this country?

Mr. Hirst: That is an irrelevant, unsatisfactory and pathetic point. I do not have that much experience of merchant shipbuilding, but I have experience of advising a yard which was a merchant shipbuilder and which made a successful transformation to the offshore technology market. I advised the yard on a close professional basis. The people in that company, whose opinions I respect, have left me in no doubt about the demanding requirements of the offshore market and the comparison that they have been able to make between that and the merchant shipbuilding world.
As a Scotsman, I share the sense of disappointment and desperation which many in Scotland feel now that the Britoil contract is in such profound difficulties. In Scotland we have almost become inured to the sight of decaying traditional industries. It was with a great sense of hope and expectation that the Scottish people looked forward to the great skills of the lower Clyde being transformed into an offshore high technology yard, and we

all share a sense of disappointment that what should have been a reality has become a nightmare and not even a dream.
Whatever our feelings about the fate of the contract and the opportunities which, sadly, have not been grasped, no one can deny that the commercial confidence that is so essential to the yard's future has been seriously damaged, or perhaps destroyed. The truth of this lies in the fact that Scott Lithgow is not on the tender list of major oil companies which put work around. That is not the fault of my right hon. Friend the Secretary of State.
The Opposition may be making a great deal of noise about my right hon. Friend's responsibilities, but it is emphatically not his responsibility that there is a crisis of commercial confidence in the yard. He alone, of all the Scottish politicians, has been issuing warning of the consequences if the work force and the management at Greenock do not change their ways. [HON. MEMBERS: "Oh!"] Were those Opposition Members who now say "Oh" issuing warning months ago that problems were in store and that the day of reckoning was to come? They are knowledgeable people whose silence is astounding.
I know that it is fashionable to knock the work force, but no one can overlook its shortcomings or the appalling financial results to which my right hon. Friend the Secretary of State referred earlier this afternoon. The delay in accepting flexible working cannot have inspired confidence in actual or prospective customers when the need for confidence was crucial.

Dr. Godman: Will the hon. Gentleman give way?

Mr. Hirst: I shall allow the hon. Gentleman to intervene in a minute.
I accept that recently there have been considerable improvements in the performance of the work force in that yard, but, in fairness, we must look at the levels against which that improvement in performance has been measured and regret the absentee rates and lack of productivity. In such a yard the conventional yardstick for the measurement of productivity in welding terms owes perhaps not a little to the management's failure to institute proper training procedures in the exacting standards demanded by the offshore market.
It would be unreasonable to attribute all, or the major part, of the blame to the work force. What about the responsibility of the management and the directors of British Shipbuilders? They were given the responsibility of operating this business, including all its subsidiaries. It appears that from the word go the yard and the contract were weak on project management, and that is not a responsibility of the work force.
Although it was a basic Odeco design, much of the design work had to be done at Scott Lithgow. Yet, why has the yard been denied the computer-assisted design facility essential for such work? This afternoon we heard that the contract was negotiated at British Shipbuilders board level, and its terms now look to have been a triumph of optimism over realism. I believe that there is acceptance on both sides of the House that the contract provides for the most technically advanced drilling vessel ever constructed, and the directors of British Shipbuilders, who, in the final analysis, must carry the can, ought to have been aware that almost certainly there would be design problems and technical difficulties to overcome when the frontiers of technology — I use that word


advisedly — were being extended. When commercial confidence is critical in offshore technology, why did the former chairman of British Shipbuilders trumpet internationally the yard's failures and problems?
I shall not try to score political points, because I do not believe that we should be doing that this afternoon, but the problems of the Scott Lithgow yard have in no way been solved by nationalisation. I would go so far as to say that had there not been nationalisation in 1977—for which all Opposition Members presumably voted—I doubt that the problems of Scott Lithgow would exist in their present form.
The broad spectrum of responsible opinion in Scotland is desperately anxious that the contract at Greenock should be completed. If half a platform and all its parts were towed off ignominously to Korea or some other foreign shipyard—if a yard capable of executing this contract exists — there would be a loss of the development expertise and experience that has been painfully and expensively gained. The damage and the loss of reputation that would follow would not only adversely affect Scott Lithgow but would cast a shadow over the offshore yards in the United Kingdom, many of which have impressive records in productivity and efficiency.
I could not in any circumstances support the Opposition's sterile solution of insisting that the Government should intervene and bail out the contract. Even if the Government did so, what would be the prospect for Scott Lithgow when the major oil firms seem unwilling to place any further business in its way? British Shipbuilders, which is dragging Scott Lithgow down with it, has lost credibility. Moreover, British Shipbuilders has given me, and perhaps many other people, the impression of wishing to wash its hands of Scott Lithgow. The Opposition's argument that, because of social and other costs, it would be cheaper to support the yard rather than let it go is insidious.

Mr. Douglas: What is the hon. Gentleman's solution?

Mr. Hirst: I shall come to my solution presently.
The Opposition's argument could be used to justify bailing out every enterprise which fails because it does not satisfy the market. That is not an argument which commends itself to me or to any reasonable right-thinking person. The only practical solution is that the yard should be acquired by an enterprise or a consortium—preferably from the United Kingdom, but I would not rule out foreigners—which has experience and expertise in platform construction and credibility in the market place as an efficient and able project manager. That enterprise or consortium would need to have the resources necessary to finance the enormously expensive work.

Mr. Douglas: The hon. Gentleman has spent some time suggesting that there is a solution which might commend itself to him and other Conservative Members. Will he enlighten the House a little further by saying from where the new consortium would obtain a cash flow and an idea of its profitability? Would such an enterprise be willing to enter into that project without Britoil's approval and/or being underwritten by the Government? If that is the case, how does that differ from actions within the present orbit of operations?

Mr. Hirst: I shall make that point later to the hon. Gentleman but I am coming up with a solution which

differs entirely from the Labour party's time-honoured solution of simply flinging money at failed enterprises as though such a lifeline guaranteed survival.

Mr. Norman Hogg: How?

Mr. Hirst: The hon. Gentleman will receive some elucidation if he cares to listen to me.
The enterprise or consortium which could acquire the yard would need to have the resources to finance the cash flow necessary to build these platforms. The hon. Member for Dunfermline, West (Mr. Douglas) need not laugh, as that has been done successfully by many enterprises throughout the world. Such an enterprise would need to augment the management at Scott Lithgow, because it clearly requires some augmentation.
I hope that such a consortium would not be frightened to embark upon any training initiatives necessary to increase productivity. In return, the consortium would be entitled to demand flexible working from the work force. I believe that the men of Scott Lithgow would be prepared to honour that commitment.
The major difficulty in such a takeover—this has been identified by the hon. Member for Dunfermline, West — would be the assumption of the contractual liabilities for rig 2002. No matter how much good will there is, assuming that British Shipbuilders and Britoil meet around the table and continue to negotiate. there will evidently be a sizeable shortfall, and in practical terms probably only the Government can bridge that gap.
I know that my Government's philosophy is non-interventionist, and in general terms I support that philosophy. I note, however, that substantial amounts of money have been made available to British Leyland to tide it over its difficulties and to institute improvements in productivity and that British Airways' debts have been written off. I make this plea for sympathetic consideration by the Government on the basis not of giving Scott Lithgow another last chance but of giving it the chance of a new beginning so that it can develop the yard's expertise to build the platforms which my hon. Friend the Member for Renfrew, West and Inverclyde (Mrs. McCulley) described as the third generation of oil platforms.
I began by referring to the successful transformation of the upper Clyde yard. I end by expressing the fervent hope of the Opposition that that successful transformation be repeated at Scott Lithgow on the lower Clyde.

Mr. Malcolm Bruce: It was interesting to hear the speech of the hon. Member for Strathkelvin and Bearsden (Mr. Hirst) as much of it was relevant to one possible solution. Nevertheless, it is a bit much to suggest that that one option is all that the Government can offer to the debate, as many of us have grave doubts about it, especially in the present time scale.
I wish to address myself to some of the problems of Scott Lithgow and the facts that must be faced before any renegotiation is likely to be effective. I believe that delay with the Britoil rig was inevitable from the moment that the contract was signed. The terms and conditions of the contract were such that Scott Lithgow could not provide the contract support necessary and the management knew it when the contract was signed. The contractors also knew it and subsequently exploited it, compounded the cost and


delay and ensured that the burden fell not on them but on Scott Lithgow. That was the advantage of the contract for them.

Mr. Barry Henderson: Will the hon. Gentleman give way?

Mr. Bruce: No, I shall not give way as I wish to make several important points and time is short.
Major—not minor—design changes were introduced during the construction of the rig. Following the loss of the Ocean Ranger rig, which was the previous generation, although the new rig was to have been called Ocean Ranger 3, it was realised that that would be a misnomer after the tragic loss of the previous rig and the findings of the inquiry into the Alexander L. Kielland disaster. That led to substantial changes, the implementation and cost of which fell on Scott Lithgow. This produced intolerable pressure on the Scott Lithgow drawing office, the manager of which spent many weeks in the Odeco offices in New Orleans trying to sort out the problems. That delay and the scale of the changes introduced by Odeco were important factors in the lateness of the contract, and it would be wrong not to appreciate the contribution to the delay made by the contractors and not just by Scott Lithgow's own problems.
The rig breaks new ground in design and weight of steel —there are 17,500 tonnes of steel in the rig—as well as in sophistication. It thus requires a design and development capability that Scott Lithgow simply did not have when the contract was signed.
Scott Lithgow's difficulties are therefore rooted not in the work force, as the Government would have us believe, but in the terms of the contract and the lack of adequate management backing by the main board of British Shipbuilders. Sir Robert Atkinson and latterly — and regrettably—Graham Day have gone out of their way on a number of occasions to ignore those problems and to stab Scott Lithgow in the back, and Ministers from the Prime Minister downwards have become accessories to the assassination of the yard. One is forced to conclude that British Shipbuilders knowingly took on a contract that was dangerous to Scott Lithgow and failed to support the yard, presumably in the belief that ultimately the yard could be closed or back-end subsidies could be obtained to see the contract through. Odeco, meanwhile, exploited the contract for all that it was worth.
When I visited the Under-Secretary of State, the hon. Member for Eastwood (Mr. Stewart), with colleagues from Inverclyde district council, the Government's main argument was based on the flexible working issue. Liberals have always accepted the importance of flexible working and from the outset urged the work force to accept it, but although we have consistently agreed that it is an important factor we do not accept that it is the main cause of Scott Lithgow's problems. It amounts to misrepresentation for the Government to persist—mischievously, in view of the facts that have come to light—in presenting that as the central argument and the main problem.
A further factor that has not been fully considered is the cost of entering this sophisticated offshore market and the investment required to allow Scott Lithgow to compete with the foreign yards which the Secretary of State seems to regard as better equipped to compete in this market. Those yards have received massive investment. The

Scandinavian yards have been bailed out by their national Governments. It is absurd not to recognise the substantial investment required for such projects. The relevant investment in Scott Lithgow was only £15 million. That is utterly inadequate to allow it to compete with Korean yards specifically designed for the purpose and in receipt of massive operational subsidies due to American Government attempts to buttress that country's economy against Communist insurgence, which is a significant factor in the tendering prices of Korean yards.
The computer-aided design facility which would greatly have helped Scott Lithgow went to Cammell Laird, the chief executive of which is the executive director of the British Shipbuilders offshore division. I am told that he rarely even visited Scott Lithgow. Certainly he has not spent much time promoting that yard, his interest in it being compromised by his prior interest in Cammell Laird.
After facing the major project management difficulties which have caused delay and cost for Scott Lithgow, considerable specialist knowledge has now been gained and must not be thrown away. All those involved must recognise that there is no guarantee that any alternative arrangements will be successful, but to throw away that expertise now that there is a stronger local management team would be extremely foolish. That management would, of course, require full backing from the management of British Shipbuilders or the relevant private corporation if renegotiation were undertaken, but now that a flexible working agreement is possible the claim of local director Willem Kooymans that the yard could be
a first-class offshore yard in three months
has considerable substance. The opportunity is there, but the yard needs the work and the contract to complete.
The cost of failing to complete the contract and closing the yard is estimated at about £109 million, of which redundancy payments alone would account for about £53 million. The highest assessment of the overall cost of renegotiating and completing the contract is £65 million. As nearly £44 million of loss has already been provided for, the net effect of cancellation and closure is £65 million while the net cost of continuation is between £14 million and £22 million. In other words, it is clear that closure would cost a great deal more than keeping the yard open, even before one considers the knock-on effects and the cost of unemployment benefit and lost tax and national insurance contributions if the work force is thrown out of work. That would certainly cost the Government at least a further £12 million and possibly £24 million in the 12 months following closure.
In those circumstances, the Government are abdicating their responsibility by not intervening. They appointed the directors of British Shipbuilders. We in this House represent the shareholders and we must look to the future of that organisation and its ability to compete in a very important area of technology. So far, Scottish Office Ministers especially have been not just spineless but ignorant. They seem not to have considered the facts. If this debate serves a useful purpose, it will be that we have drawn out some facts surrounding the issue. The importance of the debate will not lie in the over-simple arguments that have been made.
The thrust of the Government's argument seems to be that the yard could be privatised. I have no objection to that in principle and nor do my colleagues, but what has been said has been somewhat airy. There is talk of a private buyer. Who is the buyer? Where will he come


from? What are his terms? That is far from clear. The Government ought to reassure us that they know what they are talking about and that the suggestion has substance. Is Götaverken Arendal really interested? That firm has had considerable problems of its own and has in the past had to be bailed out by its own Government.
If there is the serious prospect of a private buyer, we ought to know — if possible — what it will cost the taxpayer. The hon. Member for Strathkelvin and Bearsden acknowledged that there would be a cost. The Government should also remember that the present strengthened management, which has learnt from this difficult period, will not be available to an outside buyer. Its members are on secondment from other parts of the organisation and elsewhere. Without the benefit of the experience that has been gained, Scott Lithgow might be a dubious proposition for any possible buyer.
Ministers should stop running down the yard. They should stop ignoring the complex realities of the situation. They suggest that the workers' failure to sign a flexibility agreement was at the root of the problem. There was a great deal more to it than that. That was a side issue compared with the terms and management of the contract. It is time that Ministers praised the real achievements in expertise and improved productivity, especially in the past six to nine months.
The motion and the amendment are worded in characteristically divisive and adversarial language. However, we shall support the motion because in its terms and its substance it is constructively critical. The Government's amendment shows that they can provide no solution and that they have abdicated totally their responsibility to face up to the facts, consider the real issue and use their influence to bring about a settlement, whether that settlement involves private or public ownership. The closure of the yard would be catastrophic. People in Scotland will look to the Minister for a positive assurance that in some way, by private or public means, the order can be completed on the Clyde. The Government have given no indication whatever that their privatisation option has any substance. We will therefore oppose the Government's amendment and support the Opposition motion.

Mr. Barry Henderson: The hon. Member for Gordon (Mr. Bruce) was wholly unconvincing as a poor man's adversarial politician attacking the Government. He was much more convincing when talking about the nature of the problems surrounding the contract. Although I would be very concerned if I thought that the contract was taken other than in good faith, I do not believe that that was so. The hon. Gentleman referred to genuine difficulties surrounding the contract and the management of the contract, which, I agree, were central to the problems of the yard. However, it was the responsibility of the management to see that the problems did not arise or to deal with them effectively. The hon. Gentleman also asked about the cost of a solution other than closure of the yard. He was not very convincing about that either.
The hon. Gentleman is putting forward hypotheses about what might be, under various conditions. In such arguments, what are crucial are the assumptions on which the arguments are based. The assumption made when the contract was established was that the platform would be

delivered on time and that British Shipbuilders would make a profit out of it. That was a reasonable assumption. It was on such assumptions that the Government themselves put in about £165 million of taxpayers' money to support that noble new venture, which, as my hon. Friend the hon. Member for Strathkelvin and Bearsden (Mr. Hirst) said, held out great hope for the future. The assumption was that Scott Lithgow would deliver what it had been contracted to deliver. I hope that if any other assumption is going to be the basis on which more Government money is to be spent, it will be more well-founded than that.
The people of Scott Lithgow and Inverclyde should certainly not complain of the quality of the arguments put forward by the two local Members. The hon. Member for Greenock and Port Glasgow (Dr. Godman) spoke with the sincerity that the House has come to recognise during the short time that he has been here. He spoke with power and passion. It does him no discredit to say that his speech paled into insignificance when compared with that of my hon. Friend the Member for Renfrew, West and Inverclyde (Mrs. McCurley), which was one of the most impressive speeches made in the House for a long time. [Interruption.] The speech was on a serious subject. I am sorry that the hon. Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes) cannot take that subject seriously. I hope that my hon. Friend's speech will be listened to carefully in the area that she represents. My hon. Friend spoke up for the people in her area but also pointed out some of the difficulties that will arise if we are to find a correct solution.
My hon. Friend the Member for Strathkelvin and Bearsden has had experience in relevant situations, and he was able to point out some of the things that have to be put right. We have to learn from the mistakes of the past if there is to be hope for a successful solution. I hope that that will be fully understood by everyone concerned. There have been inadequate management, outdated work practices, bad industrial relations and, above all, a lack of combined effort by everyone concerned to fulfil the terms of the contract. That must change. I challenge private enterprise to provide the solution and bring about a happy outcome to a very unhappy affair.

Mr. Harry Ewing: Today the House holds the future of a whole community in its hands. No hon. Member should be in any doubt about the serious nature of the debate and the consequences for the whole of the Greenock and Port Glasgow area and the area mentioned by the hon. Member for Renfrew, West and Inverclyde (Mrs. McCurley) if the yard should close and the Government should fail.
No one listening to the Secretary of State for Scotland today would have dreamt for a minute that the whole of west central Scotland was faced with a catastrophe. Neither my right hon. and hon. Friends nor the people of Scotland — who are more important — have any confidence in the right hon. Gentleman's ability to find a new owner or a solution to the problem. That may be because of the right hon. Gentleman's catalogue of past failures. His own record damns him in the eyes of the Scottish people.
I do not want to spend too long in enumerating those events. However, I remind the House that we were told that the Secretary of State was seriously concerned about


Linwood and that efforts were being made to attract a private buyer. However, Linwood closed. Then there was the pulp mill at Fort William. We were told that the Secretary of State was seriously concerned and that efforts were being made to attract a private buyer. However, the place closed and the community was decimated. Again, there was the smelter at Invergordon. The Secretary of State was seriously concerned. Efforts were made to attract a private buyer. Indeed, there was a short list of six. However, no one was attracted. The smelter was closed, and the community was decimated. Our fear that history will repeat itself is born not from any political opposition to the Secretary of State, although we oppose him politically, but from his record. We do not need to forecast. We have seen his record, and there can be no doubt that in Scotland community after community has been decimated because of his failure to keep open modern industries. He allowed them to go and then came to the House and told us that he was trying to attract a private buyer.
This afternoon we are talking about the future of an extensive community. In a moving speech, my hon. Friend the Member for Greenock and Port Glasgow (Dr. Godman) spelt out the social and economic consequences for the area if Scott Lithgow were to close. The area would be socially and economically decimated.
I agree with my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar) when he quoted the forecast in the Sunday Post—possibly the most damaging for the right hon. Gentleman — of the consequences of Scott Lithgow's closure.
I do not want to denigrate the hon. Member for Renfrew, West and Inverclyde, because I pay tribute to her speech, but at the beginning I felt that she was more worried about the threat from the Liberals in her constituency than about Scott Lithgow's future. Having said that, if I may use an "Irishism", I say to her hon. Friends that she has shown herself to be the only man in the Tory party in Scotland at present.
The hon. Member for Strathkelvin and Bearsden (Mr. Hirst) had the nerve to quote the position of Marathon, now UIE. The Labour Government placed an order at Marathon to build a rig on spec. Every Scottish Tory in the House opposed the order when it was placed. There would have been no UIE if the Labour Government had not shown faith in the Marathon workers. The rig was subsequently sold at a profit. All we are asking this afternoon is that the Government, and hon. Members who claim to support them, show the same faith in the Scott Lithgow work force as my hon. Friend the Member for Glasgow, Govan (Mr. Millan) and the Labour Government showed in the Marathon work force.
I do not understand how the Secretary of State for Scotland can find the matter funny. It is beyond me that the Secretary of State spends half his life sniggering at the prospect of 4,000 families being desolated by unemployment. I wish that he would take the matter more seriously and show some responsibility.
I want to deal with the rig being built at Scott Lithgow and the financial implications of the options open to the Government. The Minister of State will remember that in the Shipbuilding Act 1982—a small three-section Act which was the enabling legislation for the privatisation of British Shipbuilders — there is a commitment by the

Government that if any part of British Shipbuilders is sold to private enterprise any contract in being at the point of sale will be underwritten by the Government until it is complete. The Minister of State is bound to confirm that because it was his legislation. He and I dealt with it in Committee.
If the Government are saying that they can find a private enterprise to buy Scott Lithgow — I do not believe that is possible because the time scale will not allow for such negotiations—there is still a commitment in their legislation that they must underwrite the contract for the rig until it is completed. That will cost a substantial amount. It is astonishing that the Government are prepared to commit themselves to giving substantial sums to private companies but are not prepared, as the most disgraceful amendment that has ever appeared on the Order Paper says, to commit themselves to make the resources available so that the contract can be renegotiated.
I regret to say that the Secretary of State was misleading the House when he said that Britoil was not prepared to renegotiate the contract with British Shipbuilders. It is. We know that an agreement about the contract was made, before Graham Day became chairman of British Shipbuilders, between Britoil and British Shipbuilders. I can give details of the arrangement if the Minister of State wants them. An arrangement was made that would solve the problem at Scott Lithgow, but Graham Day was then appointed chairman of British Shipbuilders and that was a disastrous step. The external financing limit and the targets set by the Government for British Shipbuilders became severely restrictive, and to be fair to Graham Day, if I must be fair to him, he is working within the strict limits set down by the Government.
That leads to the obvious point that the solution to the problem at Scott Lithgow is political. It needs will on the part of the Government to say to British Shipbuilders and Britoil that they are prepared to make the resources available to any private company buying Scott Lithgow. Where else, as my hon. Friend the Member for Dunfermline, West (Mr. Douglas) asked, would a private company obtain the cash to buy Scott Lithgow? Although the Government refused to tell us, we can see the kind of financial package that the Government would need to present to any private company to make the purchase of Scott Lithgow attractive.
We know that Graham Day and the board of British Shipbuilders are working under strict financial limits set by the Government and that they have been told that they must restrict the output from British Shipbuilders. We know that the Cabinet line, supported by the Secretary of State for Scotland, is to let Scott Lithgow go. The campaign against closure has been supported by every section of the community in Scotland—the Church of Scotland, the Catholic church, the community, Strathclyde regional council and the local councils at Inverclyde and beyond. I understand the Secretary of State for Scotland has received a letter signed by every general practitioner in the Greenock and Port Glasgow area warning him about the serious effects the closure of Scott Lithgow would have on the health of the people. I notice that the Secretary of State did not refer to that in his speech. I make the point to emphasise the community interest in the possible closure at Scott Lithgow.
The possibility of a private company taking over Scott Lithgow may or may not be a long-term prospect. I argue that it should not be entertained.

Mr. Hirst: Why?

Mr. Ewing: If the hon. Gentleman will allow me to develop my argument, I argue that it should not be undertaken on a long-term basis. In the light of the urgent short-term problem, that is not a feasible proposition, simply because time is not on our side. We must find a solution within the next three or four weeks. The Minister of State is a realist. He has worked in the City and he knows what goes on in such negotiations—I give him that. He knows, as does every other hon. Member, that there is no possibility in the next three or four weeks of attracting a prospective buyer for Scott Lithgow, conducting all the necessary negotiations and reaching a financial arrangement. That would certainly not be a light pay day. It would involve the Government in considerable expenditure.
If a private buyer cannot be found, we must consider other ways to save Scott Lithgow and safeguard the future of a whole community. A solution would be possible, if the Government had the political will and if the Secretary of State had the influence that some people think he has. From bitter experience, I do not accept that the right hon. Gentleman has influence in the Cabinet, but others think he has. If he would use the influence that he claims to have, a political solution to the problem could be found.
What we and the people of Scotland will not accept—the hon. Member for Renfrew, West and Inverclyde will speak for herself, but I suspect that in her heart of hearts she will not accept it either—is a heart-rending story of failure from the Secretary of State. We do not want to be told in three or four weeks' time that he has lost endless nights of sleep in the search for a prospective buyer, that he has found no interest in the yard, and that, however reluctantly, the Government have decided to allow the closure.
How often have we heard that story from this Secretary of State? That is why I say that, if the right hon. Gentleman stands condemned today, he is condemned on his own record—the fact that this has happened time and time again, to industry after industry, in community after community.
The Government can solve this problem — by interfering. After all, they are interfering at present. That is why I cannot understand the reason for their amendment. They claim that they are trying to find a prospective buyer. If they are interfering to that extent, they can interfere much more, on a political level, to ensure that the rig is completed.
The Government seem prepared to stand idly by, to opt out of the world's most sophisticated technology of drilling rig construction. If we opt out of that technology, what future is there for British shipbuilding and our oil industry? If we are to be told that we cannot compete in this most sophisticated area, what future is there for this country?
I hope to goodness that the Minister of State will not say that we cannot compete, that we cannot do this or that. The work force in Scott Lithgow has been blamed for an awful lot. There has been a great deal of distortion over the past three weeks. The Government have created many problems for themselves by trying to sell this company after denigrating it.
As for the losses, it has never been pointed out that the figures include a substantial loss made on two vessels

which were on the stocks when the company was taken into public ownership in 1977. Those contracts were made by the private company, not by British Shipbuilders.
The Secretary of State and, no doubt, the Minister of State will continue to tell us that a contract is a contract: a contract made has to be agreed; and a contract has to be completed and cannot be broken. However, I tell them and their hon. Friends on the Back Benches that they have a contract. They have a contract with the people of Scotland, with the people of Greenock and Port Glasgow and of the whole of Inverclyde and Strathclyde. They had better deliver that contract in the weeks ahead or the political price that they will rightly pay will be severe. We saw that with Hamish Gray in Ross and Cromarty. I can see a few more heads rolling as a result of the Government's attitude to the issue.
That is why my right hon. and hon. Friends and I will vote enthusiastically for our motion and, with the same enthusiasm, against the Government's amendment.

The Minister of State, Department of Trade and Industry (Mr. Norman Lamont): In the debate extremely strong feelings have been expressed, which is entirely natural, given the seriousness of the situation that confronts Clydeside. Of course, I absolutely understand why so many Opposition Members and my hon. Friends felt strongly about the issue. There is no doubt that closure would be a major blow to the lower Clyde. My hon. Friend the Member for Renfrew, West and Inverclyde (Mrs. McCurley) and the hon. Member for Greenock and Port Glasgow (Dr. Godman) made it clear what it would mean for their constituencies. They advanced their cases strongly. My right hon. Friend the Secretary of State made it clear that he fully appreciated the situation and outlined some of the things that he hoped to do to help the community to find a new way forward in what are undoubtedly extremely difficult circumstances.
The debate also demonstrated that strong feelings, while understandable, can also lead to utterly wrong-headed conclusions. The Opposition always cry for Government intervention to save those who, in the past, have not always been prepared to act in time to save themselves. By "intervention" the Opposition mean, as so often, throwing more cash and more taxpayers' money at the problem.
Opposition Members must understand how we arrived at the present position. Britoil ordered the rig for delivery in April this year. In October it concluded that not only would the rig not be ready in April but, under the terms of the contract, it required Scott Lithgow to demonstrate that it could deliver it within 300 days. After a technical demonstration by British Shipbuilders, Britoil was still not satisfied that the rig could be delivered within 300 days and issued the cancellation notice on 19 December because it believed that the rig was over 300 days late.
Opposition Members have put aside all that and argued that at this stage completion must be cheaper than cancellation for Scott Lithgow. I assure the House that that emphatically is not the view of British Shipbuilders. It is the view of British Shipbuilders that it would be cheaper to cancel than to continue. British Shipbuilders and Scott Lithgow have also given the Government figures, and the Government accept that the judgment of Scott Lithgow is right. I cannot reveal those figures to the House for this very good reason. Although Scott Lithgow is in


negotiation with Britoil, there is the possibility of a private buyer being interested in the yard. We must also consider the knock-on effect of the cancellation of the contract on other contracts. It would be the height of folly for us to reveal those figures to the House. We have been shown them. We are satisfied that the view taken by Scott Lithgow is the right view.

Mr. Millan: I need hardly say that what the hon. Gentleman has said is completely unacceptable to the Opposition. If the Government will not disclose British Shipbuilders' figures, will they disclose their own figures on the cost of redundancy? That is within the Government's control and there is nothing commercially confidential about them.

Mr. Lamont: The right hon. Gentleman well understands that the figures about which I am talking are from the point of view of Scott Lithgow and the cost to the company of continuation or cancellation. That is its decision and its view. It is not a social service, and we require it to run its industry at a profit.
Opposition Members ignore the fact that, despite what is being said in the press, the rig is only one third completed. In Britoil's opinion it is already 300 days late. Huge losses have already piled up on that contract. Scott Lithgow believes that to continue to do the other two thirds of the work would expose it to considerable risks. The chairman has told me that two thirds of the assembly work remains to be done. It is in assembly work especially that accurate dimensional control is necessary and where any problems will arise.

Mr. Ewing: I am grateful to the Minister for giving way. If he had not, I should have been tempted to raise a point of order. Does he realise that once he has quoted from a document he is supposed to make it available to the House? I assume that that is provided for in a Standing Order. The Minister has quoted figures from a document which he has obviously seen. Does he agree that it is normal practice in the House, having produced figures from a document, to make the document available to the House?

Mr. Lamont: I was not quoting from a document. It was the complaint of Opposition Members that I was not giving enough figures. The hon. Gentleman will see in Hansard tomorrow all of the information which I have given.
Opposition Members must take into account the fact that huge losses have been provided for. In March last year British Shipbuilders provided £44 million for losses on this contract. In the half year accounts in December it was stated that another and even bigger provision, which was not specified, was being made. In other words, the contract which was only one third complete—

Mr. Dewar: On a point of order, Mr. Speaker. I am sorry to interrupt the Minister, but this is a matter of fundamental importance. Can you give me any advice, Mr. Speaker, as to how we can have made available documents upon which it is clear that the Government must have based their calculations? The Minister has said clearly that he has figures which have been supplied to him. They are fundamental to the judgment which Ministers have made and they are fundamental to the

judgment of the House. Is there any way in which we can ensure that the documents and the figures are made available? It is scandalous that they should be refused to the House.

Mr. Speaker: I believe that the Minister was not quoting from a document. I understood that he was quoting calculations. I have no power to require that they be made available.

Mr. Millan: Further to that point of order, Mr. Speaker. Presumably the calculations have not been done in thin air and must be in some form of document. If a document has been quoted from, should it not be laid on the Table of the House?

Mr. Buchan: Further to that point of order, Mr. Speaker. The Minister was not quoting figures but he was quoting a calculation which was based on figures. Therefore, there is documentary fact on which the Government have based their case. That is not only analogous but all square with quoting figures. I therefore hope that you will rule, Mr. Speaker, that we are entitled to see those figures.

Mr. Speaker: The Minister was not quoting from a state document. He was giving information for which he had been asked.

Mr. Lamont: As I said, I was not quoting from a document. I was asked whether the Government had been given figures which compared cancellation with continuation. I told the House that we had. I also told the House what British Shipbuilders had concluded and that, despite the uncertainties, we saw no reason to depart from that conclusion.
Despite what Opposition Members have said, Scott Lithgow's record on deliveries is not good. Bearing that record in mind, continuation of the contract would let British Shipbuilders in for an extremely long period during which losses could accelerate to even more incredible heights. That is the Government's and British Shipbuilders' view. Anyone who says that the Government should force British Shipbuilders to renegotiate is saying that we should force it to subsidise the contract even more. It is not prepared to do that and the Government are not prepared to compel it to subsidise the contract further against its commercial judgment.
Opposition Members have argued that the rig is unique and that, therefore, some problems with it are inevitable. Perhaps there is something in that. However, provision has already been made for losses of £44 million. That demonstrates a spectacular failure to move down a learning curve. With such costs, I challenge the view that it is worth continuing the attempt. There is even some dispute as to whether the rig is unique. An order for an extremely similar rig was placed with Sumitomo and it was delivered on time.
Even if the Scott Lithgow rig is different, the contract allowed extra time because of its complexity. Scott Lithgow accepted that contract. Indeed, it was keen to get it. We have always argued that the contract must be seen in the wider context of Scott Lithgow's recent performance, especially its delivery record. I am afraid that its delivery record is a sad story. Sir Robert Atkinson said that he could hardly remember when Scott Lithgow had delivered a vessel on time. The British Petroleum rig is still being completed there. It is 11 months late and yet


it is identical to a rig the order for which was placed with Hyundai at the same time, which is now in operation. Last year BP received a tanker 15 months after the contractual date. The contract for that order was renegotiated —precisely the course of action that Opposition Members are urging on us now. What was the result? A loss of 113 per cent. of the contract price.
Opposition Members accuse us of unfairly knocking Scott Lithgow. As long as Opposition Members take such an unrealistic view, ignore the problems and pretend there never have been problems at Scott Lithgow, it is necessary for us to explain why we face present circumstances and why this decision had to be made. It is not as if my right hon. Friend and other Ministers did not warn Scott Lithgow repeatedly about what was likely to happen. We warned and received no support from Opposition Members.
It might be argued whether one rig is identical to another or who is to blame for the problem, but one thing cannot be denied: Scott Lithgow's financial performance has been disastrous. I challenge any Opposition Member to dispute that. Since 1977 Scott Lithgow has accounted for 8 per cent. of employment in British Shipbuilders and for 38 per cent. of its accumulated losses. It has lost £165 million since nationalisation and last year it lost £66 million—half of British Shipbuilders' losses. It was the right hon. Member for Manchester, Gorton (Mr. Kaufman) who, when a Minister in the Labour Government, said, as my right hon. Friend pointed out today, that we cannot go on having one yard threatening the existence of British Shipbuilders.
The right hon. Member for Glasgow, Govan (Mr. Millan) criticised what the chairman of British Shipbuilders, Graham Day, has done. He seems to forget that he is the same Graham Day whom the Labour Government appointed to British Shipbuilders. Opposition Members must consider what could have been done with the £250 million that has been poured down the drain if it had been spent on Scottish industry, Scottish infrastructure, Scottish hospitals and Scottish pensions. All that we have managed to do is to maintain 6,500 jobs. How many Scottish hospitals would the Opposition like us to pour into the yard to save the contract?
It has been alleged that we are destroying the United Kingdom's capability of mobile offshore constructing. We have a private sector offshore industry. Our offshore industry must be wealth-creating and not wealth-consuming, and it is right that we should pay tribute to the orders that have been won recently by private sector companies. The right hon. Member for Govan referred to a new flexible attitude, meaning that we should give the yard another chance. The change of attitude could hardly have been left any later. We welcome the fact that at the eleventh hour and the fifty-ninth minute reality is dawning. We urge the trade unions at Scott Lithgow to sign the survival plan and accept essential changes in working practices. The position was very different three weeks ago when the call came for a national strike. Did the trade unions at that time stand up and denounce it as folly? Did Opposition Members encourage people to reject the strike call? No, they did not. I am afraid that at times it appeared as though those in the yard were ready, keen and willing to throw away their jobs.
The story has been gloomy and sad. One gleam of hope has been the possibility of a private sector takeover of the yard. I do not wish to arouse hope unduly. Nobody says

that to achieve that would be other than difficult. My right hon. Friend has said that the Government will do all that they can to encourage such a takeover. That might be a way forward.
For the Government to get out their cheque book and to force Britoil and British Shipbuilders to negotiate by writing a large cheque on behalf of British Shipbuilders is not the way forward. This is a difficult problem. Whether the problem is difficult or easy, the Opposition answer is always the same—intervene, subsidise and rescue. The cheque book approach to nationalised industries is precisely the approach that has saddled us with so many gigantic loss-makers. It has not worked in the past and, contrary to what Opposition Members may think, industry cannot be run as a social service.
For those reasons, I urge my hon. Friends to reject the Opposition's motion and to accept the Government's amendment.

Question put, That the original words stand part of the Question:—

The House divided: Ayes 205, Noes 313.

Division No. 133]
[7.02 pm


AYES


Alton, David
Davies, Ronald (Caerphilly)


Anderson, Donald
Davis, Terry (B'ham, H'ge H'l)


Archer, Rt Hon Peter
Dewar, Donald


Ashdown, Paddy
Dixon, Donald


Ashley, Rt Hon Jack
Dobson, Frank


Ashton, Joe
Dormand, Jack


Atkinson, N. (Tottenham)
Douglas, Dick


Bagier, Gordon A. T.
Dubs, Alfred


Banks, Tony (Newham NW)
Dunwoody, Hon Mrs G.


Barron, Kevin
Eadie, Alex


Beckett, Mrs Margaret
Eastham, Ken


Beith, A. J.
Edwards, Bob (W'h'mpt'n SE)


Bell, Stuart
Ellis, Raymond


Bennett, A. (Dent'n &amp; Red'sh)
Evans, Ioan (Cynon Valley)


Bermingham, Gerald
Evans, John (St. Helens N)


Bidwell, Sydney
Ewing, Harry


Blair, Anthony
Fatchett, Derek


Boothroyd, Miss Betty
Field, Frank (Birkenhead)


Boyes, Roland
Fields, T. (L 'pool Broad Gn)


Brown, Gordon (D'f'mline E)
Fisher, Mark


Brown, Hugh D. (Provan)
Flannery, Martin


Brown, N. (N'c'tle-u-Tyne E)
Foot, Rt Hon Michael


Brown, R. (N'c'tle-u-Tyne N)
Forrester, John


Brown, Ron (E'burgh, Leith)
Foster, Derek


Bruce, Malcolm
Foulkes, George


Buchan, Norman
Fraser, J. (Norwood)


Callaghan, Jim (Heyw'd &amp; M)
Freeson, Rt Hon Reginald


Campbell-Savours, Dale
George, Bruce


Canavan, Dennis
Gilbert, Rt Hon Dr John


Carlile, Alexander (Montg'y)
Godman, Dr Norman


Carter-Jones, Lewis
Gould, Bryan


Cartwright, John
Gourlay, Harry


Clark, Dr David (S Shields)
Hardy, Peter


Clarke, Thomas
Harman, Ms Harriet


Clay, Robert
Harrison, Rt Hon Walter


Cocks, Rt Hon M. (Bristol S.)
Hart, Rt Hon Dame Judith


Cohen, Harry
Haynes, Frank


Coleman, Donald
Healey, Rt Hon Denis


Concannon, Rt Hon J. D.
Heffer, Eric S.


Conlan, Bernard
Hogg, N. (C'nauld &amp; Kilsyth)


Cook, Frank (Stockton North)
Holland, Stuart (Vauxhall)


Cook, Robin F. (Livingston)
Howells, Geraint


Corbett, Robin
Hoyle, Douglas


Corbyn, Jeremy
Hughes, Mark (Durham)


Cowans, Harry
Hughes, Robert (Aberdeen N)


Cox, Thomas (Tooting)
Hughes, Roy (Newport East)


Craigen, J. M.
Hughes, Sean (Knowsley S)


Crowther, Stan
Hughes, Simon (Southwark)


Cunliffe, Lawrence
Hume, John


Cunningham, Dr John
Janner, Hon Greville


Davies, Rt Hon Denzil (L'lli)
Jenkins, Rt Hon Roy (Hillh'd)






John, Brynmor
Prescott, John


Jones, Barry (Alyn &amp; Deeside)
Randall, Stuart


Kaufman, Rt Hon Gerald
Redmond, M.


Kennedy, Charles
Rees, Rt Hon M. (Leeds S)


Kinnock, Rt Hon Neil
Richardson, Ms Jo


Kirkwood, Archibald
Roberts, Allan (Bootle)


Lambie, David
Roberts, Ernest (Hackney N)


Leadbitter, Ted
Robertson, George


Leighton, Ronald
Rooker, J. W.


Lewis, Ron (Carlisle)
Ross, Ernest (Dundee W)


Lewis, Terence (Worsley)
Ross, Stephen (Isle of Wight)


Litherland, Robert
Rowlands, Ted


Lloyd, Tony (Stretford)
Ryman, John


Lofthouse, Geoffrey
Sedgemore, Brian


Loyden, Edward
Sheerman, Barry


McCartney, Hugh
Sheldon, Rt Hon R.


McDonald, Dr Oonagh
Shore, Rt Hon Peter


McGuire, Michael
Short, Ms Clare (Ladywood)


McKay, Allen (Penistone)
Short, Mrs R.(W'hampt'n NE)


McKelvey, William
Silkin, Rt Hon J.


Mackenzie, Rt Hon Gregor
Skinner, Dennis


Maclennan, Robert
Smith, C.(Isl'ton S &amp; F'bury)


McNamara, Kevin
Smith, Rt Hon J. (M'kl'ds E)


McTaggart, Robert
Snape, Peter


McWilliam, John
Soley Clive


Madden, Max
Spearing, Nigel


Marek, Dr John
Stewart, Rt Hon D. (W Isles)


Marshall, David (Shettleston)
Stott, Roger


Martin, Michael
Strang, Gavin


Mason, Rt Hon Roy
Straw, Jack


Maxton, John
Thomas, Dafydd (Merioneth)


Maynard, Miss Joan
Thomas, Dr R. (Carmarthen)


Meadowcroft, Michael
Thompson, J. (Wansbeck)


Michie, William
Thorne, Stan (Preston)


Mikardo, Ian
Tinn, James


Millan, Rt Hon Bruce
Torney, Tom


Miller, Dr M. S. (E Kilbride)
Wainwright, R.


Mitchell, Austin (G't Grimsby)
Wallace, James


Morris, Rt Hon A. (W'shawe)
Wardell, Gareth (Gower)


Morris, Rt Hon J. (Aberavon)
Wareing, Robert


Nellist, David
Weetch, Ken


Oakes, Rt Hon Gordon
Welsh, Michael


O'Brien, William
White James


O'Neill, Martin
Williams, Rt Hon A


Orme, Rt Hon Stanley
Wilson, Gordon


Owen, Rt Hon Dr David
Winnick, David


Park, George
Woodall, Alec


Parry, Robert
Wrigglesworth, Ian


Patchett, Terry
Young, David (Bolton SE)


Pendry, Tom



Penhaligon, David
Tellers for the Ayes:


Pike, Peter
Mr. James Hamilton and


Powell, Raymond (Ogmore)
Mr. John Home Robertson




NOES


Adley, Robert
Biggs-Davison, Sir John


Aitken, Jonathan
Blaker, Rt Hon Sir Peter


Alexander, Richard
Body, Richard


Alison, Rt Hon Michael
Bonsor, Sir Nicholas


Amery, Rt Hon Julian
Boscawen, Hon Robert


Amess, David
Bottomley, Peter


Ancram, Michael
Bowden, A.(Brighton K'to'n)


Arnold, Tom
Bowden, Gerald (Dulwich)


Ashby, David
Boyson, Dr Rhodes


Aspinwall, Jack
Braine, Sir Bernard


Atkins, Rt Hon Sir H.
Brandon-Bravo, Martin


Atkins, Robert (South Ribble)
Bright, Graham


Atkinson, David (B'm'th E)
Brinton, Tim


Baker, Kenneth (Mole Valley)
Brittan, Rt Hon Leon


Baker, Nicholas (N Dorset)
Brooke, Hon Peter


Baldry, Anthony
Bruinvels, Peter


Banks, Robert (Harrogate)
Bryan, Sir Paul


Batiste, Spencer
Buchanan-Smith, Rt Hon A.


Beaumont-Dark, Anthony
Buck, Sir Antony


Bellingham, Henry
Bulmer, Esmond


Bendall, Vivian
Burt, Alistair


Benyon, William
Butcher, John


Berry, Sir Anthony
Butterfill, John


Bevan, David Gilroy
Carlisle, John (N Luton)


Biffen, Rt Hon John
Carlisle, Kenneth (Lincoln)





Carlisle, Rt Hon M. (W'ton S)
Hayhoe, Barney


Carttiss, Michael
Hayward, Robert


Chalker, Mrs Lynda
Heath, Rt Hon Edward


Channon, Rt Hon Paul
Heathcoat-Amory, David


Chapman, Sydney
Henderson, Barry


Churchill, W. S.
Heseltine, Rt Hon Michael


Clark, Hon A. (Plym'th S'n)
Hickmet, Richard


Clark, Dr Michael (Rochford)
Hicks, Robert


Clark, Sir W. (Croydon S)
Higgins, Rt Hon Terence L.


Clarke, Kenneth (Rushcliffe)
Hill, James


Clegg, Sir Walter
Hind, Kenneth


Cockeram, Eric
Hirst, Michael


Colvin, Michael
Hogg, Hon Douglas (Gr'th'm)


Coombs, Simon
Holland, Sir Philip (Gedling)


Cope, John
Holt, Richard


Cormack, Patrick
Hooson, Tom


Corrie, John
Hordern, Peter


Couchman, James
Howarth, Alan (Stratf'd-on-A)


Cranborne, Viscount
Howarth, Gerald (Cannock)


Critchley, Julian
Howe, Rt Hon Sir Geoffrey


Crouch, David
Howell, Rt Hon D. (G'ldford)


Currie, Mrs Edwina
Howell, Ralph (N Norfolk)


Dorrell, Stephen
Hubbard-Miles, Peter


Douglas-Hamilton, Lord J.
Hunt, David (Wirral)


Dover, Denshore
Hunt, John (Ravensbourne)


Dunn, Robert
Hunter, Andrew


Edwards, Rt Hon N. (P'broke)
Hurd, Rt Hon Douglas


Eggar, Tim
Irving, Charles


Emery, Sir Peter
Jenkin, Rt Hon Patrick


Evennett, David
Jessel, Toby


Eyre, Sir Reginald
Johnson-Smith, Sir Geoffrey


Fallon, Michael
Jones, Gwilym (Cardiff N)


Farr, John
Jones, Robert (W Herts)


Favell, Anthony
Joseph, Rt Hon Sir Keith


Fenner, Mrs Peggy
Key, Robert


Finsberg, Sir Geoffrey
King, Rt Hon Tom


Fletcher, Alexander
Knight, Gregory (Derby N)


Fookes, Miss Janet
Knowles, Michael


Forman, Nigel
Knox, David


Forsyth, Michael (Stirling)
Lamont, Norman


Forth, Eric
Latham, Michael


Fowler, Rt Hon Norman
Lawler, Geoffrey


Fox, Marcus
Lawson, Rt Hon Nigel


Fraser, Peter (Angus East)
Lee, John (Pendle)


Freeman, Roger
Leigh, Edward (Gainsbor'gh)


Fry, Peter
Lennox-Boyd, Hon Mark


Gale, Roger
Lester, Jim


Galley, Roy
Lewis, Sir Kenneth (Stamf'd)


Gardiner, George (Reigate)
Lightbown, David


Gardner, Sir Edward (Fylde)
Lilley, Peter


Garel-Jones, Tristan
Lloyd, Ian (Havant)


Gilmour, Rt Hon Sir Ian
Lloyd, Peter, (Fareham)


Glyn, Dr Alan
Lord, Michael


Goodhart, Sir Philip
Lyell, Nicholas


Goodlad, Alastair
McCrindle, Robert


Gorst, John
Macfarlane, Neil


Gow, Ian
MacGregor, John


Gower, Sir Raymond
MacKay, Andrew (Berkshire)


Grant, Sir Anthony
MacKay, John (Argyll &amp; Bute)


Greenway, Harry
Maclean, David John.


Gregory, Conal
Macmillan, Rt Hon M.


Griffiths, E. (B'y St Edm'ds)
McNair-Wilson, P. (New F'st)


Griffiths, Peter (Portsm'th N)
McQuarrie, Albert


Grist, Ian
Madel, David


Ground, Patrick
Major, John


Grylls, Michael
Malins, Humfrey


Gummer, John Selwyn
Malone, Gerald


Hamilton, Hon A. (Epsom)
Maples, John


Hamilton, Neil (Tatton)
Marland, Paul


Hampson, Dr Keith
Marlow, Antony


Hanley, Jeremy
Marshall, Michael (Arundel)


Hannam, John
Mates, Michael


Hargreaves, Kenneth
Mather, Carol


Harris, David
Maude, Francis


Harvey, Robert
Mawhinney, Dr Brian


Haselhurst, Alan
Maxwell-Hyslop, Robin


Havers, Rt Hon Sir Michael
Mayhew, Sir Patrick


Hawkins, C. (High Peak)
Mellor, David


Hawksley, Warren
Merchant, Piers


Hayes, J.
Meyer, Sir Anthony






Miller, Hal (B'grove)
Rumbold, Mrs Angela


Mills, Iain (Meriden)
Ryder, Richard


Mills, Sir Peter (West Devon)
Sackville, Hon Thomas


Miscampbell, Norman
Sainsbury, Hon Timothy


Mitchell, David (NW Hants)
Shaw, Giles (Pudsey)


Moate, Roger
Shaw, Sir Michael (Scarb')


Monro, Sir Hector
Silvester, Fred


Montgomery, Fergus
Sims, Roger


Moore, John
Skeet. T. H. H.


Morris, M. (N'hampton, S)
Smith, Sir Dudley (Warwick)


Morrison, Hon P. (Chester)
Smith, Tim (Beaconsfield)


Moynihan, Hon C.
Speed, Keith


Mudd, David
Speller, Tony


Murphy, Christopher
Spence, John


Neale, Gerrard
Spicer, Jim (W Dorset)


Needham, Richard
Squire, Robin


Nelson, Anthony
Stanbrook, Ivor


Newton, Tony
Steen, Anthony


Nicholls, Patrick
Stevens, Lewis (Nuneaton)


Norris, Steven
Stewart, Allan (Eastwood)


Onslow, Cranley
Stewart, Andrew (Sherwood)


Oppenheim, Philip
Stokes, John


Oppenheim, Rt Hon Mrs S.
Thatcher, Rt Hon Mrs M.


Osborn, Sir John
Thomas, Rt Hon Peter


Ottaway, Richard
Thompson, Donald (Calder V)


Page, Richard (Herts SW)
Thornton, Malcolm


Parkinson, Rt Hon Cecil
Thurnham, Peter


Parris, Matthew
Townend, John (Bridlington)


Patten, John (Oxford)
Townsend, Cyril D.(B'heath)


Pattie, Geoffrey
Tracey, Richard


Pawsey James
Trippier, David


Peacock, Mrs Elizabeth
van Straubenzee, Sir W.


Percival, Rt Hon Sir Ian
Wakeham, Rt Hon John


Pink, R. Bonner
Walden, George


Pollock. Alexander
Walker, Bill (T'side N)


Porter, Barry
Walker, Rt Hon P. (W'cester)


Powell, William (Corby)
Walters, Dennis


Powley, John
Ward, John


Prentice, Rt Hon Reg
Warren, Kenneth


Proctor, K. Harvey
Wells, John (Maidstone)


Pym, Rt Hon Francis
Wheeler, John


Raffan, Keith
Wiggin, Jerry


Raison, Rt Hon Timothy
Wilkinson, John


Rathbone, Tim
Winterton, Mrs Ann


Rees, Rt Hon Peter (Dover)
Winterton, Nicholas


Renton, Tim
Wood, Timothy


Rhodes James. Robert
Woodcock, Michael


Ridley, Rt Hon Nicholas
Young, Sir George (Acton)


Ridsdale, Sir Julian
Younger, Rt Hon George


Rifkind, Malcolm



Roberts. Wyn (Conwy)
Tellers for the Noes:


Roe, Mrs Marion
Mr. Ian Lang and


Rost, Peter
Mr. Michael Neubert.


Rowe, Andrew

Question accordingly negatived.

Question, That the proposed words be there added, put forthwith pursuant to Standing Order No. 33 (Questions on amendments):—

The House divided: Ayes 304, Noes 204.

Division No. 134]
[7.15 pm


AYES


Adley, Robert
Baldry, Anthony


Alexander, Richard
Banks, Robert (Harrogate)


Alison, Rt Hon Michael
Batiste, Spencer


Amery, Rt Hon Julian
Beaumont-Dark, Anthony


Amess, David
Bellingham, Henry


Ancram, Michael
Bendall, Vivian


Arnold, Tom
Benyon, William


Ashby, David
Berry, Sir Anthony


Aspinwall, Jack
Bevan, David Gilroy


Atkins, Rt Hon Sir H.
Biffen, Rt Hon John


Atkins, Robert (South Ribble)
Biggs-Davison, Sir John


Atkinson, David (B'm'th E)
Blaker, Rt Hon Sir Peter


Baker, Kenneth (Mole Valley)
Body, Richard


Baker, Nicholas (N Dorset)
Bonsor, Sir Nicholas





Boscawen, Hon Robert
Griffiths, E. (B'y St Edm'ds)


Bottomley, Peter
Griffiths, Peter (Portsm'th N)


Bowden, A. (Brighton K'to'n)
Grist, Ian


Bowden, Gerald (Dulwich)
Ground, Patrick


Boyson, Dr Rhodes
Grylls, Michael


Braine, Sir Bernard
Gummer, John Selwyn


Brandon-Bravo, Martin
Hamilton, Hon A. (Epsom)


Bright, Graham
Hamilton, Neil (Tatton)


Brinton, Tim
Hampson, Dr Keith


Brittan, Rt Hon Leon
Hanley, Jeremy


Bruinvels, Peter
Hannam, John


Bryan, Sir Paul
Hargreaves, Kenneth


Buchanan-Smith, Rt Hon A.
Harris, David


Buck, Sir Antony
Harvey, Robert


Bulmer, Esmond
Haselhurst, Alan


Burt, Alistair
Havers, Rt Hon Sir Michael


Butcher, John
Hawkins, C. (High Peak)


Butterfill, John

Hawksley, Warren


Carlisle, John (N Luton)
Hayes, J.


Carlisle, Kenneth (Lincoln)
Hayhoe, Barney


Carlisle, Rt Hon M. (W'ton S)
Hayward, Robert


Carttiss, Michael
Heathcoat-Amory, David


Chalker, Mrs Lynda
Henderson, Barry


Channon, Rt Hon Paul
Heseltine, Rt Hon Michael


Chapman, Sydney
Hickmet, Richard


Churchill, W. S.
Hicks, Robert


Clark, Hon A. (Plym'th S'n)
Higgins, Rt Hon Terence L.


Clark, Dr Michael (Rochford)
Hill, James


Clark, Sir W. (Croydon S)
Hind, Kenneth


Clarke, Kenneth (Rushcliffe)
Hirst, Michael


Clegg, Sir Walter
Holland, Sir Philip (Gedling)


Cockeram, Eric
Holt, Richard


Colvin, Michael
Hooson, Tom


Coombs, Simon
Hordern, Peter


Cope, John
Howarth, Alan (Stratf'd-on-A)


Cormack, Patrick
Howarth, Gerald (Cannock)


Corrie, John
Howe, Rt Hon Sir Geoffrey


Couchman, James
Howell, Rt Hon D. (G'ldford)


Cranborne, Viscount
Howell, Ralph (N Norfolk)


Critchley, Julian
Hubbard-Miles, Peter


Crouch, David
Hunt, John (Ravensbourne)


Currie, Mrs Edwina
Hunter, Andrew


Dorrell, Stephen
Hurd, Rt Hon Douglas


Douglas-Hamilton, Lord J.
Irving, Charles


Dover, Denshore
Jenkin, Rt Hon Patrick


Dunn, Robert
Jessel, Toby


Edwards, Rt Hon N. (P'broke)
Johnson-Smith, Sir Geoffrey


Eggar, Tim
Jones, Gwilym (Cardiff N)


Emery, Sir Peter
Jones, Robert (W Herts)


Evennett, David
Joseph, Rt Hon Sir Keith


Eyre, Sir Reginald
Key, Robert


Fallon, Michael
King, Rt Hon Tom


Farr, John
Knight, Gregory (Derby N)


Favell, Anthony
Knowles, Michael


Fenner, Mrs Peggy
Knox, David


Finsberg, Sir Geoffrey
Lamont, Norman


Fletcher, Alexander
Lang, Ian


Fookes, Miss Janet
Latham, Michael


Forman, Nigel
Lawler, Geoffrey


Forsyth, Michael (Stirling)
Lawson, Rt Hon Nigel


Forth, Eric
Lee, John (Pendle)


Fowler, Rt Hon Norman
Leigh, Edward (Gainsbor'gh)


Fox, Marcus
Lennox-Boyd, Hon Mark


Fraser, Peter (Angus East)
Lester, Jim


Freeman, Roger
Lewis, Sir Kenneth (Stamf'd)


Fry, Peter
Lightbown, David


Gale, Roger
Lloyd, Ian (Havant)


Galley, Roy
Lloyd, Peter, (Fareham)


Gardiner, George (Reigate)
Lord, Michael


Gardner, Sir Edward (Fylde)
Lyell, Nicholas


Garel-Jones, Tristan
McCrindle, Robert


Gilmour, Rt Hon Sir Ian
Macfarlane, Neil


Glyn, Dr Alan
MacGregor, John


Goodlad, Alastair
MacKay, Andrew (Berkshire)


Gorst, John
MacKay, John (Argyll &amp; Bute)


Gow, Ian
Maclean, David John.


Gower, Sir Raymond
McNair-Wilson, P. (New F'st)


Grant, Sir Anthony
McQuarrie, Albert


Greenway, Harry
Madel, David


Gregory, Conal
Major, John






Malins, Humfrey
Renton, Tim


Malone, Gerald
Rhodes James, Robert


Maples, John
Ridley, Rt Hon Nicholas


Marland, Paul
Ridsdale, Sir Julian


Marlow, Antony
Rifkind, Malcolm


Marshall, Michael (Arundel)
Roberts, Wyn (Conwy)


Mates, Michael
Roe, Mrs Marion


Mather, Carol
Rost, Peter


Maude, Francis
Rowe, Andrew


Mawhinney, Dr Brian
Rumbold, Mrs Angela


Maxwell-Hyslop, Robin
Ryder, Richard


Mayhew, Sir Patrick
Sackville, Hon Thomas


Mellor, David
Sainsbury, Hon Timothy


Merchant, Piers
Shaw, Sir Michael (Scarb')


Meyer, Sir Anthony
Silvester, Fred


Miller, Hal (B'grove)
Sims, Roger


Mills, lain (Meriden)
Skeet, T. H. H.


Mills, Sir Peter (West Devon)
Smith, Sir Dudley (Warwick)


Miscampbell, Norman
Smith, Tim (Beaconsfield)


Mitchell, David (NW Hants)
Speed, Keith


Moate, Roger
Speller, Tony


Monro, Sir Hector
Spence, John


Montgomery, Fergus
Spicer, Jim (W Dorset)


Moore, John
Squire, Robin


Morris, M. (N'hampton, S)
Steen, Anthony


Morrison, Hon P. (Chester)
Stevens, Lewis (Nuneaton)


Moynihan, Hon C.
Stewart, Allan (Eastwood)


Mudd, David
Stewart, Andrew (Sherwood)


Murphy, Christopher
Stokes, John


Neale, Gerrard
Thatcher, Rt Hon Mrs M.


Needham, Richard
Thomas, Rt Hon Peter


Nelson, Anthony
Thompson, Donald (Calder V)


Neubert, Michael
Thornton, Malcolm


Newton, Tony
Thurnham, Peter


Nicholls, Patrick
Townend, John (Bridlington)


Norris, Steven
Townsend, Cyril D. (B'heath)


Onslow, Cranley
Tracey, Richard


Oppenheim, Philip
van Straubenzee, Sir W.


Oppenheim, Rt Hon Mrs S.
Wakeham, Rt Hon John


Osborn, Sir John
Walden, George


Ottaway, Richard
Walker, Bill (T'side N)


Page, Richard (Herts SW)
Walker, Rt Hon P. (W'cester)


Parkinson, Rt Hon Cecil
Walters, Dennis


Parris, Matthew
Ward, John


Patten, John (Oxford)
Warren, Kenneth


Pawsey, James
Watson, John


Peacock, Mrs Elizabeth
Wells, John (Maidstone)


Percival, Rt Hon Sir Ian
Wheeler, John


Pink, R. Bonner
Wiggin, Jerry


Pollock, Alexander
Wilkinson, John


Porter, Barry
Winterton, Mrs Ann


Powell, William (Corby)
Winterton, Nicholas


Powley, John
Wood, Timothy


Prentice, Rt Hon Reg
Woodcock, Michael


Proctor, K. Harvey
Younger, Rt Hon George


Pym, Rt Hon Francis



Raffan, Keith
Tellers for the Ayes:


Raison, Rt Hon Timothy
Mr. David Hunt and


Rathbone, Tim
Mr. Douglas Hogg.


Rees Rt Hon Peter (Dover)





NOES


Alton, David
Boyes, Roland


Anderson, Donald
Brown, Gordon (D'f'mline E)


Archer, Rt Hon Peter
Brown, Hugh D. (Provan)


Ashdown, Paddy
Brown, N. (N'c'tle-u-Tyne E)


Ashley, Rt Hon Jack
Brown, R. (N'c'tle-u-Tyne N)


Ashton, Joe
Brown, Ron (E'burgh, Leith)


Atkinson, N. (Tottenham)
Bruce, Malcolm


Bagier, Gordon A. T.
Buchan, Norman


Banks, Tony (Newham NW)
Callaghan, Jim (Heyw'd &amp; M)


Barron, Kevin
Campbell-Savours, Dale


Beckett, Mrs Margaret
Canavan, Dennis


Beith, A. J.
Carlile, Alexander (Montg'y)


Bell, Stuart
Carter-Jones, Lewis


Bennett, A. (Dent'n &amp; Red'sh)
Cartwright, John


Bermingham, Gerald
Clark, Dr David (S Shields)


Bidwell, Sydney
Clarke, Thomas


Blair, Anthony
Clay, Robert


Boothroyd, Miss Betty
Cocks, Rt Hon M. (Bristol S.)





Cohen, Harry
Lofthouse, Geoffrey


Coleman, Donald
Loyden, Edward


Concannon, Rt Hon J. D.
McCartney, Hugh


Conlan, Bernard
McDonald, Dr Oonagh


Cook, Frank (Stockton North)
McGuire, Michael


Cook, Robin F. (Livingston)
McKay, Allen (Penistone)


Corbett, Robin
McKelvey, William


Corbyn, Jeremy
Mackenzie, Rt Hon Gregor


Cowans, Harry
Maclennan, Robert


Cox, Thomas (Tooting)
McNamara, Kevin


Craigen, J. M.
McTaggart, Robert


Crowther, Stan
McWilliam, John


Cunliffe, Lawrence
Madden, Max


Cunningham, Dr John
Marek, Dr John


Davies, Ronald (Caerphilly)
Marshall, David (Shettleston)


Davis, Terry (B'ham, H'ge H'I)
Martin, Michael


Dewar, Donald
Mason, Rt Hon Roy


Dixon, Donald
Maxton, John


Dobson, Frank
Maynard, Miss Joan


Dormand, Jack
Meadowcroft, Michael


Douglas, Dick
Michie, William


Dubs, Alfred
Mikardo, Ian


Dunwoody, Hon Mrs G.
Millan, Rt Hon Bruce


Eadie, Alex
Miller, Dr M. S. (E Kilbride)


Eastham, Ken
Mitchell, Austin (G't Grimsby)


Edwards, Bob (W'h'mpt'n SE)
Morris, Rt Hon A. (W'shawe)


Ellis, Raymond
Morris, Rt Hon J. (Aberavon)


Evans, loan (Cynon Valley)
Nellist, David


Evans, John (St. Helens N)
Oakes, Rt Hon Gordon


Ewing, Harry
O'Brien, William


Fatchett, Derek
O'Neill, Martin


Faulds, Andrew
Park, George


Field, Frank (Birkenhead)
Parry, Robert


Fields, T. (L'pool Broad Gn)
Patchett, Terry


Fisher, Mark
Pendry, Tom


Flannery, Martin
Penhaligon, David


Foot, Rt Hon Michael
Pike, Peter


Forrester, John
Powell, Raymond (Ogmore)


Foster, Derek
Prescott, John


Foulkes, George
Radice, Giles


Fraser, J. (Norwood)
Randall, Stuart


Freeson, Rt Hon Reginald
Redmond, M.


George, Bruce
Rees, Rt Hon M. (Leeds S)


Gilbert, Rt Hon Dr John
Richardson, Ms Jo


Godman, Dr Norman
Roberts, Allan (Bootle)


Golding, John
Roberts, Ernest (Hackney N)


Gould, Bryan
Robertson, George


Gourlay, Harry
Rooker, J. W.


Hardy, Peter
Ross, Ernest (Dundee W)


Harman, Ms Harriet
Ross, Stephen (Isle of Wight)


Harrison, Rt Hon Walter
Rowlands, Ted


Hart, Rt Hon Dame Judith
Ryman, John


Haynes, Frank
Sedgemore, Brian


Healey, Rt Hon Denis
Sheerman, Barry


Heffer, Eric S.
Sheldon, Rt Hon R.


Hogg, N. (C'nauld &amp; Kilsyth)
Shore, Rt Hon Peter


Holland, Stuart (Vauxhall)
Short, Ms Clare (Ladywood)


Howell, Rt Hon D. (S'heath)
Short, Mrs R.(W'hampt'n NE)


Howells, Geraint
Silkin, Rt Hon J.


Hoyle, Douglas
Skinner, Dennis


Hughes, Mark (Durham)
Smith, C.(Isl'ton S &amp; F'bury)


Hughes, Robert (Aberdeen N)
Smith, Rt Hon J. (M'kl'ds E)


Hughes, Roy (Newport East)
Snape, Peter


Hughes, Sean (Knowsley S)
Soley, Clive


Hughes, Simon (Southwark)
Spearing, Nigel


Janner, Hon Greville
Stewart, Rt Hon D. (W Isles)


Jenkins, Rt Hon Roy (Hillh'd)
Stott, Roger


John, Brynmor
Strang, Gavin


Jones, Barry (Alyn &amp; Deeside)
Straw, Jack


Kaufman, Rt Hon Gerald
Thomas, Dafydd (Merioneth)


Kennedy, Charles
Thomas, Dr R. (Carmarthen)


Kinnock, Rt Hon Neil
Thompson, J. (Wansbeck)


Kirkwood, Archibald
Thorne, Stan (Preston)


Lambie, David
Tinn, James


Leadbitter, Ted
Torney, Tom


Leighton, Ronald
Wainwright, R.


Lewis, Ron (Carlisle)
Wallace, James


Lewis, Terence (Worsley)
Wardell, Gareth (Gower)


Litherland, Robert
Wareing, Robert


Lloyd, Tony (Stretford)
Weetch, Ken






Welsh, Michael
Wrigglesworth, Ian


White, James
Young, David (Bolton SE)


Williams, Rt Hon A.



Wilson, Gordon
Tellers for the Noes:


Winnick, David
Mr. James Hamilton and


Woodall, Alec
Mr. John Home Robertson.

Question accordingly agreed to.

MR. SPEAKER forthwith declared the main Question, as amended, to be agreed to.

Resolved,
That this House, recognising the wisdom of the Government's general policy of declining to seek to interfere in management responsibilities in industry and commerce, would deplore any moves by the Government to involve itself in the resolution of the matters in dispute between Britoil and Scott Lithgow over the contract to build a semi-submersible drilling rig; and notes that since the Scott Lithgow Yard was nationalised losses underwritten by the taxpayer total £165 million.

British Rail Engineering Ltd.

Mr. John Prescott: I beg to move,
That this House, being opposed to the large scale redundancies recently announced by British Rail Engineering Ltd. which mean closures at the Shildon and Horwich works and directly threaten the future of railway workshop activity in Swindon, Derby and elsewhere, is concerned at the further reduction of British Rail Engineering Ltd. capacity and of maintenance and safety standards on British Rail; recognises that these, passenger service cut-backs, privatisation and accelerated job loss programme are the first consequences of the Secretary of State's decision to accelerate the reduction of financial support for the railways; and urges Her Majesty's Government to reject this Serpell strategy for British Rail and British Rail Engineering Ltd. and to develop a comprehensive programme for the modernisation and expansion of freight and passenger services.
This debate, like the previous one, is about redundancies, as embodied in the motion before the House in the names of myself and my right hon. and hon. Friends. We wish to bring to the attention of the House the consequences of British Rail's proposals regarding British Rail Engineering and their effect on redundancies throughout the country. The motion is concerned with redundancies not just in one area of the country. Many engineering areas in the north. east, south and west of the United Kingdom are to suffer further redundancies as a result of recent announcements of accelerated redundancy programmes and closures of British Rail Engineering Ltd.
This is the second debate in the House to be held on BREL in 10 months. The last debate led to accusations that the Opposition held it at the time of the Shildon by-election. I know of no engineering works in Chesterfield, so I assume that it is acceptable for the House now to debate the serious issues involved in the redundancies and closures in British Rail Engineering Ltd.
Since the debate last March there has been increased uncertainty for British Rail employees, and of British Rail Engineering in particular. That uncertainty has been greatly exacerbated by the statement that was rushed out a few days after the appointment of the Secretary of State for Transport in October, in which new objectives were set for British Rail. The motion therefore reflects the concern that is felt about the redundancies and this policy.
We note that the Government's amendment is less abrasive than it was in March. That may well be due to the fact that Tory Members of Parliament were returned for constituences covering Shildon and Swindon.

Mr. Dennis Skinner: Where are they now?

Mr. Prescott: In Darlington. I do not see them in attendance at this debate.
We wish to bring to the attention of the House the fact that these redundancies are the legitimate concern of the Opposition. In making these inquiries the Opposition are not, as they were accused by the hon. Member for Swindon (Mr. Coombs) in questions on rail shop closures, scaremongering. No doubt the hon. Gentleman is having severe thoughts about his position on these new proposals.
The last debate was concerned largely with over-capacity in the wagon works, and we were treated to an example by the then Secretary of State, the right hon. Member for Guildford (Mr. Howell), of what he called "statistics" in alleging that the investment programme of the Tories was considerably better than that of the previous


Labour Administration. As investment is an extremely important part of the argument, I shall spend some time on that so as to correct that aspect of Tory policies as given by the right hon. Gentleman at that time.
A common concern running through all the debates on this subject has been the increasing use of the Serpell report's conclusions. It is deplorable that the House has never debated the Serpell report. It is equally deplorable that we should not have had a separate debate in Government time on British Rail policy since the Tories came to power in 1979. Clearly that is completely inadequate, especially as we have seen such major changes in British Rail policy being brought about by further Government interference. We have seen the development of a new policy towards the industry. At least Serpell provided a number of options for the future of the services of British Rail—and for British Rail Engineering—but those options have not been put forward for discussion in our debates.
It is not my case tonight to deploy the alternative high investment argument—the alternative railway policy—which we on the Labour Benches favour—lower fares, the maximum utilisation of assets and a high investment policy. Perhaps the Government, if they will provide a day, will allow us the opportunity not only to criticise their policy towards British Rail but to consider that alternative. If the Government do not do that, we shall attempt to use our own time to deploy that point. However, the Government have a responsibility to provide time for the discussion of British Rail because it so much affects the United Kingdom as a whole, including those who use British Rail services and those employed by BR.
For that reason, I do not intend to address my remarks to the different arguments about each engineering workshop affected by the redundancies. I am sure that my hon. Friends will address themselves to the different aspects of the problems faced by the engineering works in their areas. However, the one point that engineering workshops have in common is that they have all suffered from an inadequate and unsustained investment programme, and that has led to their having an unfair share of misery and uncertainty. That is one factor which predominates in the whole argument relating to British Rail Engineering.
I wish to concentrate on the Government's responsibility in the matter. Their influence on British Rail policy has been considerable, though it has been more by the back door than by the open front door. They have used their influence powerfully, first, through the powers available to them in the sanctioning of the investment programme and the terms and conditions relating to the returns on such investment; secondly, by determining the level of public service obligation grants and the financial limits to such public support; and, thirdly, through their ideological demand for further privatisation of the public sector.
It is necessary, first, to look briefly at the sort of sea-change which took place in policy towards British Rail, which was eventually to affect the level of investment and the whole attitude towards British Rail Engineering. If one reads the various rail plans which have been issued since 1980 and compares the different attitudes adopted in those plans, one finds it an interesting and stimulating experience, although the conclusions in the later stages are depressing.
In the rail plan covering 1981 to 1985, we find that the railway industry was full of optimism. Here were a Government representing business interests who would get the British economy moving and British Rail, it was felt, would benefit from that. It predicted higher investment and the return to a profitable railway system rather than one on deficit. For British Rail Engineering, those reports stated that it had the problem of undercapacity. Indeed, it was predicted in 1980 that for British Rail Engineering the future represented an increased demand for labour of 1,000 employees a year.
It was said that the problem would not be a shortage of work, but an adjustment of the workload, bearing in mind the decline in the wagon work and the increasing new investment that was being envisaged. However, a warning was given, an extremely important warning bearing in mind what followed. That plan stated about British Rail Engineering:
The principal risk area covers the stability of the forecast workload, which assumes the ability of rail business to come forward at the agreed time with the necessary orders. Failure to do this would have serious implications in the under-utilisation of capacity and hence the non-recovery of overheads which have to be passed on.
That was precisely what happened.
However, at that time, in the optimism of the early 1980s, another report—"Rail policy for the eighties"—made it clear that 1983 was to be the watershed year, when decisions on investment levels had to be taken. Investments had been delayed for more than the present Government's term of office—I am prepared to admit that. The areas where that investment had to take place were identified on that occasion. It meant, for British Rail Engineering, a considerable future as a result of new investment. However, it also asked for a new financial regime to determine and finance the new investment programme.
The Government heard what was said and set up the Serpell committee, and it came to exactly the opposite conclusions. It came to low investment conclusions, with a reduction in maintenance, redundancies and delay in investment. It is ironic that the man who sat on both committees, Sir David Serpell, apparently agreed with both sets of conclusions in those different reports, all within 12 to 18 months. Nevertheless, an important point was identified. Serpell identified the saving of £170 million—a vital point, as I shall show later. It also pointed out that savings of £40 million could be made on the engineering side — again, by the formula of redundancies, cuts in maintenance, closures and delayed investment.
When that report came out, British Rail was rather embarrassed. It thought that it would be compared with the European system, a comparison that it had made and, in so doing, had found that BR had compared quite well. Serpell was not interested in that, but only in its terms of reference, and they were how to cut down financial support for the British Rail system. That, basically, was what Serpell was set up to do, and at the same time to give a few options for the future. Serpell achieved that. As a result, British Rail—although making some criticisms of Serpell—had to reconsider its position, and the pending appointment of a new chairman along the way obviously concentrated the mind marvellously.
When it came to British Rail Engineering Ltd., the judgment was arrived at that its future was not so rosy as was at first thought. BR made some criticisms of the


Serpell report, including the fact that the financial savings to which Serprell had pointed were not proper savings, and BR took the view that Serpell had not paid proper attention to the circumstances of BR. Nevertheless, while it had criticisms of Serpell, the 1983 to 1988 plan showed that the British Railways Board had clearly got the Government's message. That message was that it must no longer expand in investment or services. It was now "A plan out of recession." An end to the recession could not be seen, so it could hardly be a plan based on the expansion of railway services. Accordingly, it was designed to be a plan out of recession.
What, then, were the criteria and priorities for British Rail? They involved a culling of the public service obligation by 25 per cent., delayed investment and increasing redundancies — exactly the Serpell formula embodied into the plans for BR. The result was that more redundacies were to be built upon an already accelerated redundancy plan forming the background to British Rail.
For example, between 1970 and 1979 there were 3,000 redundancies a year on British Rail. That was increased between 1979 and 1983 to 7,500 a year. In the 1983 –88 plan that was increased to 10,500 a year. We now await the 1984 plan, which is being drafted based on objectives set by the Secretary of State. My money is on its being an acceleration of the process, with more unemployment and redundancy and more cutbacks in services.
We note that British Rail Engineering Ltd. will have to suffer 4,000 redundancies, and it is estimated that as a result of those redundancies £30 million could be saved. Yet the cost of those redundancies must be about £25 million. As Serpell points out, it was not his obligation to look at the cost of the community of redundancies. It is clearly the responsibility of the Secretary of State to balance these important costs to the community, but that does not have high priority with this Government. This would be only a further drop in the millions who have been made unemployed by the Government's policies.
What is also tragic is that 700 apprenticeships are to be done away with. The opportunity to train our youngsters in skilled work will be denied. Presumably they will now be offered one year on the youth training scheme, and employers will be paid to take them on for one year, instead of their being trained in a nationalised industry as the skilled manpower which is essential and necessary for when the economy begins to turn round. We hope that manufacturing will play an essential part in that.
We are changing from the workshops to the supermarket, and that is no future for a developed manufacturing country. In the 1983–85 plan there is no longer any investment expansion for British Rail Engineering Ltd. The plan makes it clear why the expansion cannot take place, despite the earlier plans. It refers to a
progressive reduction in BR's fleets of locomotives, wagons and carriages in recent years, together with unfulfilled forecasts of increased new build of traction and rolling stock in successive Rail Plans.
This has led to a
situation of a substantial overcapacity and associated underutilisation costs.
That is what was predicted would happen if the investment programme and support for British Rail did not come through. The plan went on to make it clear that even the proposals in the 1983 plan on the future of BREL depend on

matching capacity and perceived workload. It is, however. heavily dependent on the authorisation by the Government of the traction and rolling stock projects included within the Rail Plan.
Investment and agreement to investment are crucial to the future of BREL.
I wish to comment particularly on that in view of the fatuous remark by the previous Secretary of State for Transport, the right hon. Member for Guildford, who compared the investment programmes of the past three or four years of the Tory Government with those of the last three or four years of the Labour Government. He did not compare them at constant prices, but did so at current prices, and did not weight them down. I have since done that and I shall put the figures on record.
The right hon. Gentleman said that when the figures are added together it meant that the Tories had invested more, but the reality of the figures is different. The figures that I have are based on British Rail figures, and I have had them checked. In the three years to 1979, £1,660 million was invested in British Rail. Up to 1983, £1,375 million was invested. Although it was not adequate ever, then, under three years of Labour Government investment was £285 million more, comparing like with like. What is more worrying is that in the new plan of British Rail, the next three years to 1986 will involve an investment programme of £1,593 million, which is £69 million less than the investment to 1979 under a Labour Government.
Those figures have been exacerbated by ministerial delays in sanctioning investment and the programmes that they have had before them, by the delay in the electrification programme and by the target set by the Government, which was previously set for the 125s, that there has to be a commercial return on the investment by 1988. That has made British Rail more concerned about revenue, in order to prove itself so that it can get the Government's agreement for an electrification programme. That will hinder further investment development and British Rail has already withdrawn some inter-city stock investment because of the Government's emphasis on revenue and not on investment. Those are the difficulties surrounding investment in British Rail.
Against that background, I shall look at the statement made by the Secretary of State in October. He further tightened the screw on British Rail and the investment consequences. As he comes from the Treasury, perhaps we should expect that. He is a Treasury boot boy put in to do the job to show that he can be tougher than anybody else and that what really matters is how the Government reduce public support. We should look at the consequences of that, because it is important to BREL.
In his statement in October the Secretary of State said that the cut in the public service obligation — which British Rail had proposed in a hara-kiri way to reduce by 25 per cent. by 1988—must now be achieved by 1986. BR's figures, which I have checked, show that the difference between BR's corporate plan and the new target set by the Secretary of State will mean a loss of income of £145 million from the public service obligation. If we add to that the £40 million that was lopped off the 1983 public service obligation by the Government in another lit of saying, "We will give you less", we see that they have robbed British Rail of £185 million. The Secretary of State had difficulty about figures in our last debate, and if he is in doubt I shall throw the figures over to him again. I know


that he has employed a higher transport economist since our last debate, so perhaps we can take into account some expert opinion.

Mr. Skinner: The Prime Minister is against economists.

Mr. Prescott: I think that my hon. Friend is referring to her play acting.

Mr. Skinner: Oh no.

Mr. Prescott: Let us hope that the economist that the Department of Transport has taken on will improve the information flow.
By 1986 the public service obligation target of £635 million will mean an inevitable reduction in some investment play, because there is investment money in the public service obligation. That has had an effect on investment and that is £76 million less than the figure set in 1975 when the public sector obligation was introduced by the Labour Government. We are giving British Rail less in real terms than in 1975, against a background of reduced revenue earnings.
Moreover, pressures by the Government have led to cuts in the mileage routes in every part of the United Kingdom and a reduction in services. It is interesting to note that Serpell, when he looked at how much public money would be needed for the BR system — as he acknowledged it was — felt that £635 million would sustain a route size of 8,000 miles. As the present route size is 10,000 miles, this may be another demonstration of the Secretary of State's move towards a reduction in the route miles of BR's services because of the necessity to reduce costs.
The effect has been reduced services, the packing of people into trains in the south-east, as we have heard, single trackways, closing of routes and reduction of maintenance. The effect on BREL has been to increase its uncertainty and the loss of further investments orders. That uncertainty is further compounded by the Serpell options put to BREL. The report suggested that the Government should consider either taking the share capital of BREL, privatising or giving British Rail its own work to do in engineering, without a capacity to do new building work.
The Secretary of State's statement in October made it clear that the rationalisation of BREL was an objective for the Government and that they would complete their review of the consequences of that, including the future of BREL and its privatisation. Perhaps we can hear from the Secretary of State this evening what the Government's policy is on privatisation and what options he has.
The consequences of this uncertainty confirm what a director of personnel in BR said in February when talking about the redundancies:
I think I must also caution that unless BREL succeeds in increasing its share of the world market for traction and rolling stock requirements, the probability of another medium-sized Works closing in 1986–87 time scale cannot be ruled out.
These redundancies will probably lead to the closure of a medium-sized works. Will that medium-sized firm be at Swindon, Doncaster, York or Derby? That is what the Labour party is being asked. Let there be no doubt that the architects of this policy are the Government and their obsession with public expenditure cuts. This policy denies

sufficient financial support to a railway system already under-financed compared with Europe, affecting investment, causing further deterioration of services for passengers, accelerating redundancies and uncertainties for the remainder, while once again preparing to pull under public assets with the privatisation of BREL.
This country has paid dearly for its monetarism-obsessed Government, of which the Secretary of State is a keen lieutenant. He will bear the direct responsibility for the future likely closures and redundancies that will follow in British Rail Engineering Ltd., yet to be announced. That is why tonight the Opposition will press the motion standing in the name of myself and my right hon. and hon. Friends.

Mr. Deputy Speaker (Mr. Harold Walker): Mr. Speaker has selected the amendment in the name of the Prime Minister.

The Secretary of State for Transport (Mr. Nicholas Ridley): I beg to move, to leave out from "House" to the end of the Question and to add instead thereof:
while deeply sympathising with the people affected by necessary industrial change, wishes to see an efficient railway engineering industry in the United Kingdom that can supply British Rail and the rest of the domestic market competitively and win orders from overseas; and strongly supports the British Railways Board's efforts to achieve this.
I agree with the hon. Member for Kingston upon Hull, East (Mr. Prescott) on one thing at least, and that is that there are no railway works at Chesterfield. If there were, I am sure that he would wish to close them. I am sure that the hon. Gentleman would do anything he could to embarrass the situation there.
I start by summarising the facts of the current situation at British Rail Engineering Ltd. A year ago British Rail announced that, as a result of the over-capacity which had arisen in its engineering subsidiary, it would be necessary to close the workshops at Shildon, Horwich and Temple Mills. That is common knowledge to the House, which debated the matter last March. In that debate, my right hon. Friend the Member for Guildford (Mr. Howell), the then Secretary of State, made it clear that these were decisions for the BR management to take, but that they arose from the changing needs of the railway.
The recent announcement is that just under 4,000 jobs will have to go during 1984 — including some 500 salaried staff—and that number includes about 1,500 from those earlier closure decisions. Unfortunately, BREL has found it necessary now to make further reductions, for reasons which I shall explain later. Those reductions will cause some job losses at most BREL works, but they are particularly associated with Swindon, Derby—Litchurch Lane—and Doncaster, because of the particular nature of the work that is involved.
I repeat that those decisions are the responsibility of the BR management. I shall deal with the matters that the hon. Gentleman raised in his speech in this regard. They are not — as the hon. Gentleman and the motion allege — a consequence of any of my decisions. I say that to make the position clear, and not to wash my hands of the matter. I deeply sympathise with the people at BREL and their families who are affected by these changes. However, we cannot pretend that the changes are not necessary, and we would not be helping either the people concerned or those who remain in BREL if we did not face that fact. So I


believe that the Government and the House should give the board of British Rail and the management of BREL full support in tackling these difficult problems honestly and humanely.
I re-emphasise that I realise that this news is a personal tragedy for many people. The pace of industrial change has been constantly quickening in recent years. I shall explain in due course the changes that have brought about these redundancies — better equipment leading to less maintenance, more intensive usage of equipment, and the decision to end asbestos stripping.
Industrial change of this sort has hit many of our industries, as the Opposition know. On every occasion they suggest that the Government should seek to arrest change, because of the hardship that it causes. If we had listened to them, as they know in their hearts, we would have many inefficient, uncompetitive industries, which would have impeded labour mobility to the new industries, and prevented us from securing export orders.

Mr. Prescott: What new industries?

Mr. Ridley: The real question for them to answer is whether they really want to slow down the pace of industrial change, with all its attendant consequences of uncompetitiveness, or just to try to make political capital out of other people's misfortunes.
Before I turn to the specific issues, I want to say a word about the Opposition motion. It alleges that safety standards on British Rail might be reduced. Safety is the statutory responsibility of the railway, and neither the board nor I would countenance a lowering of standards. In fact, 1982 had a better safety record than any previous year in the history of the railways, and I understand that 1983 maintained that excellent standard. British Railways' 1983 plan envisages a substantial increase in investment in rolling stock and infrastructure, but in any case BR maintains and operates its equipment at all times with safety as a paramount aim. I hope that the hon. Gentleman, who fortunately did not repeat what is in the motion in his speech, will not repeat accusations of that nature which are totally unjustified.

Mr. Stephen Ross: May I point out that on certain lines—for example, the railway line from Shrewsbury to Aberystwyth—the speeds have had to be substantially reduced to make sure that there are no accidents?

Mr. Ridley: That is an example of putting safety first. It is exactly the point that I was making. If a railway track is not capable of taking a high-speed train, it is clearly right to limit the speed.
What are the reasons for these redundancies and for the past redundancies that my right hon. Friend debated in March? The needs of the railway are changing. Just as the switch from steam to diesel in the 1950s led to massive rationalisation and restructuring of railway engineering workshops, so steady investment and modernisation over the past decade has led to the present round of adjustments in the workshops.
There have been big changes in British Rail's requirement for maintenance and refurbishment, and that has large consequences for BREL, because four men in five are engaged in maintenance work. When BREL is so heavily involved in maintenance work, it is inevitable that investment and modernisation will significantly affect its

workload. The changes taking place should not, therefore be seen as a mark of decline or decay or a lack of orders but as a mark of efficiency and modernisation. As in so many other industries, more modern equipment means that the work can be done more quickly, with less effort, and with less need for routine maintenance. We have been constantly pressed for more investment in British Rail.
The hon. Gentleman's speech was not about BREL but about the pressure for more investment, to which I shall come in a moment. One of the consequences of investment is that less repair and maintenance are needed. Let me give some examples to the hon. Gentleman, who does not appear to have gone into the matter very deeply.
The fleet size of loco-hauled passenger coaches was over 7,000 10 years ago in 1974, the year on which the public service obligation is based. This year the service is now provided with just over 4,000 coaches. The new diesel multiple units, recently ordered, will result in three units doing the same work that four units used to do. They will require servicing only half as often as the old units. It means that for the same capacity there will be only three eighths of the maintenance work that there was before. It all proves to the hon. Gentleman that the more he shouts for investment, the more he will impinge on the amount of work that goes to BREL.
My right hon. Friend the Member for Guildford explained to the House in the debate last March the reasons underlying the dramatic decline in BR's orders in the particular case of wagons—both in the number of new wagons needed and the number of wagons needing repair. British Rail envisages no requirement for new wagon building in 1984, compared with 1,000 or more a year in past years. Those are the circumstances in which the board is now regretfully having to carry through the closure decision for Shildon.

Mr. Harry Cowans: The Minister cannot have his cake and eat it. In arguing his case, he talks about brand new modern rolling stock. The converse must be true: that if they are old, clapped-out wagons and rolling stock, they must need more maintenance, and they are not getting it. The right hon. Gentleman cannot have it both ways.

Mr. Ridley: I have given the hon. Gentleman precise examples of modern railway stock on the railways requiring less maintenance. Every time new investment is made this effect has to work through on the maintenance side.

Mr. Peter Snape: Does this apply to aeroplanes?

Mr. Ridley: The hon. Gentleman must not relate this debate to aeroplanes. It has nothing to do with aeroplanes; it is about BREL.
Finally, there are job losses resulting from the board's recent decision to stop stripping asbestos from diesel multiple units. It is these which will affect particularly the workshops at Swindon, Derby Litchurch lane and Doncaster. The board has given an undertaking to its unions that it will complete the removal of asbestos from its rolling stock by the end of 1987. Although asbestos does not represent an immediate danger, where it is sealed, the board agreed to eliminate it over a 10-year time scale ending in 1987. Removal of asbestos is a costly and unpleasant process requiring very careful safety precautions.
The board has now decided that, at any rate for its DMU fleet, the best way of honouring the commitment to eliminate asbestos-bearing vehicles is to provide new rolling stock. It will be cheaper, and will give rail passengers new vehicles rather than retread ones.
Those are the reasons for the redundancies. The reasons which the hon. Member for Kingston upon Hull, East dreamt up are laid at the door of the Government. I will go through them one by one to show how wrong he was. First, at Question Time last week the hon. Member for West Bromwich, East (Mr. Snape) criticised British Rail for putting its orders for new rolling stock out to competitive tender.

Mr. Snape: No, I did not. I criticised the Government for insisting that it did.

Mr. Ridley: Let me follow that through. The hon. Gentleman says that he criticised the Government for insisting that it did. He implied that that was all my doing since it was mentioned in the chairman's objectives, but the move towards competitive tendering was board policy long before I was Secretary of State or I set the chairman his objectives.
Competitive tendering was proposed by BREL itself as long ago as 1981. Both the board and the Government are absolutly agreed that the railway must secure the best value for money. We cannot expect the railway to operate in a businesslike fashion and at the same time require it to place its orders with just one, its own in-house, supplier. The decision by British Rail to seek competitive tenders for the 150 lightweight DMUs, for which we announced approval last week, is the first new order for a major programme replacing the DMU fleet. It is in no way an anti-BREL decision and it will compete, I am sure, with vigour to get the order. But hon. Members, some of whom may be present, who represent constituencies in Birmingham, Cambridge, Falkirk and Workington, have an equal interest that firms in those towns—

Mrs. Gwyneth Dunwoody: And Brazil.

Mr. Ridley: No; tenders have been invited from firms in those towns and from BREL itself. It is extraordinary that the hon. Member for West Bromwich, East wants to ensure that the orders go to BREL by not giving workers in the other towns the opportunity to quote and to get the work. I wonder whether it is right for the Labour party to show its partiality towards one concern in the public sector —[Interruption.] The hon. Gentleman just said that he did. He criticised me for having asked British Rail to do so. The truth is that it did it on its own account.
The hon. Member for Kingston upon Hull, East claimed that the trouble was the denial of investment to British Rail. As I have explained, the job losses are the direct result of past investment. For instance, Shildon is closing because British Rail has invested in a fleet of modern wagons over the past 10 years which, in the age of computerised control, can now be used up to eight times more productively than old-fashioned wagons. He must be aware that higher investment will lead to less maintenance work and less work for BREL. At some point, sooner or later, the Opposition will have to realise that there has not been an enormous lack of investment in the railway. They are victims of their own propaganda.
British Rail has invested no less than £1,500 million since 1979 at current prices and plans to invest a further £2,000 million by 1988. In the past few months alone, we have authorised investment in 60 mark III coaches, 149 electrical multiple units, 150 diesel multiple units, the Tonbridge-Hastings electrification and the electrification of part of the line to Cambridge. Lack of investment is not the problem. Last year British Rail did not invest as much as its external financing limit would have allowed and it has not been restrained for investment since I have been Secretary of State. Since I have occupied this job no major investment proposal which could have benefited BREL has been turned down. We have done everything possible to reach decisions as quickly as possible. I think that hon. Members will acknowledge that we have succeeded.
The only scheme which is still awaiting a decision, apart from one for further DMUs—medium weight this time—which arrived in my office only yesterday is the scheme for electrification of the east coast main line, and for that we need to see a satisfactory plan for a commercial inter-city business. The board is working on that major review and we hope to see the result in two or three months. Then I shall move as quickly as possible to a decision.
However, even if we were to approve east coast main line electrification tomorrow, it would do nothing to solve the immediate problem of overcapacity in BREL. Electric services to Leeds would not begin until 1989. The board would not need to build new rolling stock until a year or two earlier. It is still developing the electric traction vehicles that would be needed for the service, and a prototype 125 mph locomotive will not be available until next year. So hon. Members should not see electrification as an immediate solution to the problems facing BREL.
There seems to be a fallacy in the mind of the hon. Member for Kingston upon Hull, East, although I know that he and the hon. Member for West Bromwich, East have been to British Rail, that the reduction in the public service obligation grant is in some way connected with reductions in the engineering work load because of its effect on investment. The fact is, as the chairman, Bob Reid, is reported as telling his unions only last Thursday:
investment is growing. In 1983 we spent some £270 million. We are planning a 40 per cent. increase in investment to £380 million in 1986".
I think that it belies what has been said about the investment strategy because it is clear that the railways are not in any sense constrained. I welcome the increased investment. I want to see worthwhile investment going ahead, and the four approvals I have given since October are proof of that.
What the Opposition seem not to understand is the difference between the PSO grant and the external financing limit. The PSO grant is the limit of the Government's contribution towards the running costs in cash. The EFL is larger and makes the extra room for external borrowing. In fact, investment money comes from four sources. First, there is the PSO grant. Secondly, there are earnings; the hon. Member for Kingston upon Hull, East rather belittled the importance of the revenue that BR earns. Thirdly, there are sales of assets, a justification for privatising parts of railway land and establishments. Finally, there is external borrowing. The more operating costs can be reduced by increased efficiency, the more grant and earnings are available for investment. The PSO grant may be on a reducing scale,


but that is compatible with a high EFL and ample room for investment. Those are the facts. As hon. Members may know, BR's bid for an external financing limit of £936 million for 1984–85 is precisely the figure we settled on. Therefore, it has been given the full amount of investment room it asked for.
The motion refers also to "passenger service cutbacks". As I have said to the House previously, in the new timetable starting this year there will be only 2 per cent. less loaded train mileage in London and the south-east and less than a 1 per cent. reduction nationally. That is designed merely to follow the pattern of the traffic.
The hon. Member for Kingston upon Hull, East sought to blame the Government for the lost jobs in the review of the future of BREL. I have asked the chairman to complete the review by the middle of this year. British Rail had already conducted the review before I set the objectives. I merely set a clear timetable. The motion refers to "privatising", which I assume means the privatising of BREL.
British Rail's review of BREL encompasses a complete range of options of which privatisation is but one. As the review will not be completed until the middle of the year —I have not seen anything of it and I will not see it until it is presented to me—there is no question of the future of BREL having been determined already as a result of the review. Therefore, the job losses, which we all deplore, at Shildon—they stem from the circumstances surrounding asbestos removal and the general decline in the maintenance work load—can have nothing to do with the review, or with privatisation. The job losses are the result of straightforward management action to match capacity to demand. They are the sort of losses which, unfortunately, occur from time to time as technology advances and businesses evolve to meet the needs of their customers. BREL is bound particularly to be affected as four out of five of its work force are employed on repair and maintenance work.
We must look to the future of BREL as a major element in a successful British railway engineering industry. We must not try to ossify the present structure. British Rail and the Government want to see a competitive railway engineering industry which can supply BR efficiently and also win more overseas orders. That is the way in which BREL and private sector firms such as Metro Cammell are moving to try to secure a major part of their work load from overseas. There was an article about that in yesterday's edition of The Guardian, which reported interest in a major order from Singapore. That is the way in which future employment in Britain will be secured. Employment will not be achieved by tying BREL to its major customer and requiring it to maintain capacity for which it no longer has productive use.
I invite the House to support the Government's amendment and to reject the Opposition's mischievous and misleading motion.

Mrs. Gwyneth Dunwoody: There are many ways of killing a cat: one can hang it from a tree or starve it to death. On the whole, the Secretary of State believes in what might be termed benign neglect. I sometimes think that over his door he has the following words carved: "Thou shalt not kill, but thou shall not strive to keep alive".
Perhaps it will be helpful to put on record the Government's attitude towards the railway system, especially to the British Rail workshops. The Government came to office determined to privatise as rapidly as possible any major national asset that they were able to put into the private sector. Their attitude towards the railway system was shown by the fact that they were responsible for the initiation of the Serpell report. That report was based on the simple assumption that one could form a set of conclusions and then write the rest of the report to match the decision that had been made in the first place. There was even an advance on Serpell because the Government had two sets of conclusions. However, there was only one report, which was supposed to produce the necessary results.
Let us try to be as honest as possible. The British Rail engineering workshops are remarkable throughout this manufacturing land for the excellence of their work. They are a pool of highly skilled men and women, and if those people are allowed to lose their jobs — if they are dissipated as a work force—they will contribute to a loss of expertise that will never be replaced. If we forgo the jobs at Shildon and at the other railway workshops, we shall be depriving the nation of a precious asset, but it is obvious that that is what the Government have in mind. There has been a deliberate rundown in investment since they came to office. The constant chopping and changing of plans is unacceptable from a Government who say that they want the railway industry to be effective.
What has happened about asbestos stripping? About 60 per cent. of the work of railway workshops is directed to repairs. We are told by the Secretary of State in his insouciant manner that we should not worry because there will be a great deal of new build and that there will have to be no more asbestos stripping. Why was he careful not to set out a timetable? How soon does he expect the new build to replace all the DMUs, which only last August were part of a stripping programme? How will he justify to the public the abandonment of the stripping programme? We feel strongly about these matters in Crewe, but we are aware of the danger of asbestosis. There have been a number of deaths in the Crewe area as a result of that frightening disease. Is the right hon. Gentleman prepared to say that 650 jobs will go down the drain because of the abandonment of the entire programme, but that that does not matter because new DMUs will be produced? That is hypocritical nonsense and it makes it difficult for us to take him seriously.
It was suggested as recently as August 1983 that over 1,800 DMUs needed to be stripped of asbestos. However, we were told in a document that was published in January that the figure had magically become 1,090. It is obvious that the Government are determined to remove the work from British Rail workshops.
There are other frightening consequences apart from the loss of existing jobs as a result of the conscious policy of neglect. It is terrifying that the future of the railway towns is being thrown away. Until recently, 120 apprenticeships were offered in my constituency each year. Bright boys and girls contributed to the excellence of the railway workshops and they acquired high standards of skill. Many of them were the representatives of third and fourth generations of railway families. They had a strong commitment to the works in which they were to receive their training but at the same time they understood the need for change far better than does any Conservative Minister.
Over the past two years only 90 apprentices have been taken on. That reduction has taken place during a period in which there has been a constant rundown of jobs in other sectors of the engineering industry. Luckily, my constituency has been sheltered from the worst of the job losses, but this year no apprentices will be taken on in the Crewe works. Presumably they will be farmed out into the entirely insufficient YTS schemes, where they will not receive a craft training. They will not be able to produce the positive and highly efficient manufactured goods that it would have been open to them to produce in the railway workshop. They will be filling in time so that they can be removed from the unemployment register and not cause some unfortunate hazard to the Prime Minister when she talks about the number of young people on the dole.
The Government's intention in respect of employment in the railway workshops is now starkly clear. They say, "It is not we who are responsible for the job losses. Responsibility lies with BREL and the British Railways Board." But they know that the drive of Conservative party policy was enshrined in the attitude which the Serpell report made only too plain — if it is a nationalised industry, get rid of it. It seems that it does not matter whether a nationalised industry has demonstrated its efficiency or whether it is an industry in which investment could produce a positive national benefit. Job losses are acceptable to the Government as long as they are confined to nationalised industries. To that blind bigotry, they are prepared to add a policy that will lead us into a position where, in 10 years' time, we could find ourselves importing engines, wagons and other goods from any other country simply because of some 19th century economic hang-up displayed by the present Ministers.
The Conservative party's irresponsibility is breathtaking, as is its arrogance and the way Conservative Ministers come to the Dispatch Box and cheerfully say, "We understand. Of course, it means some difficulty for some work forces." They cannot justify their policy on the grounds of economics or protection of the public, or as a means of creating new employment or improving economic conditions. We shall go through the Lobby joyfully tonight because it will be a positive and real attempt to make someone on the Conservative Benches understand the damage that the Government are doing.

Mr. Conal Gregory: Contrary to rumour, and after hearing the Opposition, Conservative Members believe that the railways have a key role to play in public transport. That means placing the customer first, and I have not yet heard one word from the Opposition about the customer. It is the customer who pays for the railway industry. There is no question of embarking upon major route closures, as is implied in the motion. We can examine the services that are run in the public interest and cannot fully pay their way. We need to make a contrast between a social railway with branch lines that will perhaps never pay their way, and the inter-city business that is the rightful consideration of BR's management. About £1,500 million was committed by the first Thatcher Government to the railway industry, but I heard no recognition of that from the Opposition. It is high time that we gave credence to that action and reminded the railway unions that support for the industry of about £2,000 million

has already been announced by the Under-Secretary during the next four and a half to five years before we plan for our third Thatcher Adminstration. BR is obliged to provide branch lines, and until both sides of the House reach that political decision we will be faced with a dilemma. We should consider the motion against that background.
The Government's task is not to intervene constantly in the management decisions of a nationalised industry but to set out objectives. It is prudent that I quote to the House the relevant clause of the Transport Act 1962:
It shall be the duty of the Railways Board … to provide railway services in Great Britain … and to provide such other services and facilities as appear to the Board to be expedient, and to have due regard … to efficiency, economy and safety of operations.
Those words should be enshrined in the hearts of those who think about the railway industry.
BREL, which forms the major substance of the motion, is streamlining itself in line with two strategies: first, the need to reduce capacity to match demand and, secondly, to embrace a new definition of its role. It is right to redefine BREL's relationship with British Rail in such central areas as design. I know that BREL is freeing itself from the BR-dominated design requirement in areas such as supply, contractual arrangements, personnel policies and the financial equity of the company — in other words, it is a part of BR that is moving towards a market-orientated business. That is instanced by the building of the prototype class-58 heavy freight locomotive and the first sale of a light-weight railbus to a customer outside BR. The managing director of BREL has said that the company has high hopes for that railbus in export markets in south-east Asia, the United States and selected European countries such as Denmark and Greece. He said that BREL is determined to increase its share of the world's railway equipment market.
I speak with some knowledge of the railway industry as I represent York where about 2,500 are employed in BREL and about 5,000— also a substantial number—on the administrative side at headquarters. I know that for price, quality and workmanship York has no competitor. I welcome the chance to take those Opposition Members who perhaps are not paying due attention to the York carriage works where they can see that that is true. Workers at York and elsewhere have been scared by false rumours that the Government are not prepared to approve BR's investment proposals. I have referred already to the past and planned expenditure. In 1981 BR underspent its limits by 23 per cent. and in 1982 by 37 per cent. so there are certainly no financial restrictions. If BR were spending up to its limit I believe that there would be some substance to the argument.
The specific investment in rolling stock has included almost £24 million in York for 149 electrical multiple units for London commuter services, which were announced early in December in the House, about £30 million refurbishment for the Fenchurch street-Southend line, which means 90 four-unit electrical trains, and about 150 light-weight railbuses.
BREL's management is faced with the full force of competition when BR's forecast requirements are substantially lower than in the 1970s. I ask my right hon. Friend the Secretary of State to suggest to BR that where job losses are unavoidable — the Conservative party regrets that—they are mitigated to the extent of more generous severance payments such as are offered in the


coal, steel and shipbuilding industries. BR's severance payments are about one and half weeks' pay for every year of service, and I should like to see the British Railways Board treating its staff with the sense of care shown by other industries.
Today, there is less need for heavy maintenance work because of the efficiency of modern equipment, especially the high speed trains. It is a matter of moving on, not constantly looking backwards. Our modern rolling stock will be improved. My right hon. Friend the Secretary of State referred to replacing old wagons with the air-braked freight wagons.
At heart, BREL is an engineering company. Its competitiveness and enthusiasm will be illustrated by its response to tender for a prototype short-haul diesel. I am forced to divulge to the House that in 1982 BREL's turnover per employee was £13,000, which is less than half the turnover in a comparable engineering business. That must be a cause for concern for the work force and management. York carriage works is convinced that it has the ability to win the tender in competition with private industry — Metro Cammell— but at the same time we must bear those national figures in mind.
With the prospect of east coast main line electrification, BREL has the opportunity in the next decade to build new traction and to replace worn-out diesel fleets. It is a fallacy to say that BR has received instructions to swing the Serpell axe, as the Opposition suggest. There is no validity in that assertion. The instruction is to run present levels of passenger mileage — as distinct from train mileage, which may involve empty trains—while reducing real costs.
Export potential has been sadly neglected. Insufficient publicity is given to the carriage works' potential to achieve a greater share of the export market. Some union convenors seem to wish to be the funeral directors of BREL. The more they take that line, the more the business prospects that Conservative Members wish to encourage will be jeopardised. Convenors who adopt that scaremongering policy put the jobs of their own members at risk.

Mr. Snape: I do not know whether the union convenor at York carriage works has expressed any concern about the future. If he has, I hope that the hon. Gentleman did not accuse him of scaremongering. Does the hon. Gentleman realise how many redundancies are forecast for that works by the end of the year?
Does the hon. Gentleman also regard it as scaremongering to issue a document in which all the options forecast a widespread rundown of the railway industry and two involve the complete rundown of the freight industry from which the bulk of the revenue comes? What does he consider to be the likely effect of such a document on any potential customer of BR, at home or overseas?

Mr. Gregory: I am surprised that the hon. Gentleman does not do his homework before coming to the House, as Conservative Members do. The figure to which he refers is 82 for the York works. As for the options, in relation to such an important nationalised industry and given the substantial contribution by the taxpayer, it is appropriate in a democracy that the options should be set before people.

Mr. Snape: In other words, the Government are intervening.

Mr. Gregory: References to a great Serpell axe draw attention away from the productive side of the industry. If the hon. Gentleman is interested in jobs he will certainly support the export potential and the work being undertaken this very day by the chairman of BREL, who I believe is currently in Africa drumming up business. The export potential is very great as BREL, regrettably, currently enjoys only 5 per cent. of the world trade. In the past two years, with a certain amount of marketing push, it has doubled the number of tenders. The opportunities are there and the prizes are great. The fact that we seem not to have secured the £23 million order for the Congo should in no way deflate the energies of BREL management and work force in seeking more orders. I am sure that my right hon. Friend the Secretary of State was as delighted as I was earlier this week to hear of the order from Singapore.
One might consider a wide variety of export orders, but that is clearly a matter for the management. Conservative Members can only give full support, as I am sure will our embassies abroad, to BREL's efforts to obtain a greater share of the international market. In that way we shall not only help our balance of payments, but sow a strong seed for the future of BREL in the next quarter century.

Mr. Derek Foster: I warn the hon. Member for York (Mr. Gregory) not to adopt such a naive and trusting attitude towards promises given by BREL. We were told that the Shildon works was safe. Only 12 months before the axe fell we were told that no possible reorganisation of BREL could fail to guarantee the long-term future of Shildon. That undertaking was given by the chairman of BREL and the then Minister of State. They said that Shildon was the jewel in the crown of BREL and the most efficient wagon-producing works in Europe. The works made a profit. It had a most co-operative work force who had adopted every flexible working practice that any management could desire. Just 12 months later, the axe fell on the 2,600 jobs at Shildon. The hon. Gentleman should be very careful about listening to the promises of his right hon. Friends or the chairman of BREL.
The reason given for the demise of Shildon was that its market had disappeared. We do not deny that there has been far more efficient use of rolling stock, but BR's own marketing strategy favoured the private sector to the disadvantage of its own rail works. I shall not rehearse those arguments again as we have been into them many times. The management of BREL then assumed that its work force was incapable of adapting to small batch production and specialist production. What a slap in the face that was for the people who a few months earlier had been described as the most co-operative work force imaginable.
I wish to put a specific question to the Secretary of State about the trumpeted prospect for an order for 700 wagons granted under section 8 of the Transport Act for the transport of scrap iron and steel as a result of an alliance between BR and British Steel. Originally all those wagons were to be produced in the private sector, but when we made a big fuss in the House we were told that Shildon could participate in the order. That never materialised. Will the Minister now tell us exactly what happened to that?
The real reason for the demise of Shildon was the lack of investment in BREL as a whole. We have been dilly-dallying over electrification for at least four years, although joint reports by the Department of the Environment and BR said that it was a highly commercial investment. We have been dilly-dallying about the replacement of clapped-out rolling stock for just as long. As we have heard already, lack of investment in BREL has jeopardised safety standards on the railways, and I do not accept the Secretary of State's explanation of that for one moment.
Lack of investment in the 12 BREL workshops forced the rationalisation which caught Shildon in its wake. That rationalisation provides a perfect excuse for the eventual privatisation of BREL as a whole. The fate of Shildon was privatisation by the back door. Having starved a plant of orders, it is easy to point to overmanning and make people redundant. The equipment and facilities at the works can then be written down and sold at a knockdown price to any private sector employer who wishes to use them. That is privatisation by the back door. I warn many other British Rail Engineering works that there will be privatisation by the front door as well, and many more redundancies following in its wake.
What will happen now that the Government are determined to close what was described by British Rail Engineering as its most efficient wagon works? How long will it be before we import wagons from South Korea or, indeed, before we import all our rolling stock? That would add to our mounting deficit on manufactures. It would be a most eloquent comment on the Government's economic failure.
Why do the Government not learn from their European partners, who have sensible transport policies? Other European countries give much higher subsidies to the railways, and make no excuses for it. They believe in an integrated transport system in which rail plays a full part. They understand the environmental arguments. We do not wish to see the destruction of our towns and villages by excessive road transport. Other European countries understand the fuel economy arguments. The free market dismisses those arguments and leaves the community to pay the environmental and social costs.
In the case of Shildon we shall see the destruction of a community which was proud of its railway history, of its product and of its rationalised industry. The people there were hewn out of the rock like the coal that they used to mine. They were tempered in the forge—the forge which still remains at Shildon works. They were shaped by struggle. Shildon is a vibrant community throbbing with life and energy, a caring community. It represents the best in the working class values of thrift, independence, self-reliance and family life. Those are the values which the Prime Minister purports to admire, but in Shildon, and throughout the north of England, the Prime Minister's policies are destroying those values. Families in Shildon are facing long-term poverty, and the community will disintegrate and decay.
The Labour movement was raised to make sure that such things should not happen and that working people would no longer be crushed by impersonal market forces. It was raised to ensure that working people would no longer be swept on to the scrap heap like useless garbage. It was raised to give them pride and dignity and enable

them to hold their heads high as men and women able to shape their destinies and control their lives. The Prime Minister has told a whole generation of northerners that they are worthless and useless.
Cannot the right hon. Lady see that the Government have a responsibility to conserve what is valuable? A Conservative Government should be able to see that. Cannot the Government see that they have a responsibility to help a community to adapt to change? Shildon does not believe that anyone owes it a living. It does not seek to hold back the tide of history or economic advance. It wants a chance to adapt to change and not to be submerged by it.
I appeal to the Minister and the Government to help the community of Shildon. They should invest in British Rail in a proper way, and let the orders flow to all the British Rail Engineering works, including Shildon. However, if they are set against that sensible policy, will they give Shildon a job-hunting agency to attract some jobs to the community and give it some chance for the future? Failing that, will they instruct British Rail to set up a holding company to manage those valuable assets, and the skills of those totally dedicated people, and enable them to produce products which can be sold — as the hon. Member for York has said—throughout this country and the world? It is not too late for the Government to intervene in the name of compassion to help the community of Shildon.

Mr. Simon Coombs: I speak as one who is directly affected by the threat to jobs in British Rail Engineering. I am not alone in that respect in this debate. Many of my hon. Friends have the same problem in their constituencies. We have heard from my hon. Friend the Member for York (Mr. Gregory), and we may hear from others. The electors in our constituencies trust their Conservative Members to speak up on their behalf. That may not be to the liking of some Opposition Members, but it is true I speak for my constituents. I speak as one who is deeply committed to the principle of public transport. Viable rail and bus services should be provided for those who cannot afford cars and to maximise the use of the road network by removing cars from it. However, that does not mean unlimited subsidy or inefficiency.

Mr. Ron Lewis: Will the right hon. Member give way?

Mr. Coombs: No, I will not. I am grateful to the Under-Secretary of State for visiting my constituency yesterday to see the rail works in Swindon. On that visit, he saw the anger of many members of the work force. He saw the bitterness that many of them feel, and the frustration and resignation which were clear for all to see. He also saw the efficiency and the excellent work practices that are demonstrated there, and the skill in mechanical engineering of which the works is justly proud.

Mr. Lewis: Will the hon. Gentleman give way?

Mr. Coombs: The Under-Secretary talked to union representatives who expressed willingness to co-operate in a future which was efficient and flexible and who understood the needs of modern industry. He saw the pride in a tradition which at Swindon goes back to 1849.
However, the Under-Secretary also heard about the kick in the teeth administered to that work force in the past


few days, because 1,217 jobs will go by the end of the year if the present proposals are carried out. He heard that, after the contract for asbestos stripping originally given to the Swindon works had been taken away, partially given back and then taken away again, the men wonder whether they are coming or going. I do not blame them.
I saw, on the wheel of one of the carriages being refurbished at the works, the slogan "When one door closes, another one shuts." That is illustrative of the bitterness in the works. Many, including the Under-Secretary, must have wondered whether the indecision over the asbestos contract is typical of the indecision and muddle demonstrated by the management of British Rail Engineering and whether it could and should have been avoided.

Mr. Lewis: The hon. Gentleman is commenting on the fact that the Minister went to Swindon. Does he condone the decision to make 1,600 people in Swindon redundant?

Mr. Coombs: The hon. Gentleman is wrong. The figure is not 1,600. I referred, had he been listening to what I said, to 1,217.

Mr. Lewis: Does he condone that?

Mr. Coombs: If the hon. Gentleman will allow me, I will come to that point.
The reality of these sorry circumstances does not lie in the wild accusations from the Labour party that we have heard in the House tonight and on other occasions outside the House. Opposition Members frequently mention Serpell. The Serpell report is enough; it acts as a trigger to make Opposition Members foam with excitement because they believe that it represents the Government's intentions. It does not. It is a substitute for thought for Opposition Members.

Mr. Prescott: Read it.

Mr. Coombs: When the motion talks about the Serpell report, the hon. Gentleman and I part company. I do not consider supporting his motion.
The new investment announced last week in the House for diesel multiple units and electrification of new routes is good news for Great Britain and British Rail, but, at the same time, bad news for Swindon. I know that, and do not need to be told by Opposition Members.
For a works such as Swindon which can only undertake repair, rebuild and refurbishment work, the problem is clear. The Labour party cannot have it both ways. It calls for more investment, and I support that. The simple proposition is that if we have that investment the work needed to repair the old rolling stock will be diminished. It is one that Opposition Members are too simple to follow and understand. If new investment comes to British Rail, as it is coming and will come, the old rolling stock will be scrapped and works such as Swindon will lose.
At the moment, the future appears bleak. I wish to say to the Government and BREL that much can still be done. First, I should like to see redundancies at the works avoided in the short term until such time as the options that are still open for BREL can be considered with the report that will go before the Secretary of State in the summer.
Secondly, I should like to see the immediate appointment of a sales enginer to the staff at Swindon to help in the job of seeking extra work for that rail works. The last sales engineer died two years ago and was not replaced. Why? I should like an answer to that question.
Thirdly, I hope that the BREL management will press on with the rationalisation programme to cut the overheads at the Swindon works to make them more efficient and cost competitive, and to provide new jobs on the surplus land which Swindon will need if these redundancies occur.
Fourthly, I hope that there will be a deliberate attempt to diversify the activities of the Swindon works; to look at the prospects for new work; to look outside the rail works; to look at the needs of other transport undertakings for repair and maintenance; and to look at road vehicles. It was said to me yesterday that if the country decided that Her Majesty the Queen required a new state landau the place to have it made was the Swindon works. Fine—let us consider such prospects and opportunities. Let us be flexible in our approach and not adopt the narrow-minded approach of some Opposition Members.
Fifthly, as my hon. Friend the Member for York (Mr. Gregory) said, we must insist that BREL mounts an intensive export drive to sell its skills and does not sell them short by playing down its abilities.
Sixthly, I ask—I support what was said by the hon. Member for Crewe and Nantwich (Mrs. Dunwoody)— that the figures should be checked again to ensure that the programme of asbestos stripping can be dispensed with against the proposal for new build to meet the deadline of 1987, because I am not entirely convinced that that can be done within the next three years. Let us ask for that to be done again to ensure that there is not still the need for asbestos stripping on existing vehicles before 1987.
Seventhly, I ask that there should be a check on the cost effectiveness and productivity of each of the works with a rigour not hitherto seen.
Eighthly, I ask the Government to ensure that BREL management is capable of the highest standards of industrial enterprise and industrial relations practice.
Ninthly, I look for help from all sources to ensure that if there are to be redundancies there should be assistance with the retraining and rehabilitation of those affected for whom this decision, if it is implemented, will be a tragedy. I look particularly to the European social fund from which I believe money may be available to help for such purposes.
Finally, I appeal to the Government and BREL on behalf of a railway town and its workers, the apprentices who have been taken on only recently, and those who are near retirement for whom there is little prospect of further work, not to throw away valuable assets of skill and dedication. I believe that the Government have a duty to ensure that this nationalised industry is run as well and efficiently as possible. I look to the Government to demonstrate that commitment tonight.

Mr. Deputy Speaker (Mr. Ernest Armstrong): I remind the House that this is a very short debate. I ask for extreme brevity or not all hon. Members who wish to will be able to catch my eye.

Mr. Stephen Ross: Mr. Deputy Speaker, I shall try to conform to your request. I feel slightly embarrassed, because I do not represent a railway town. I recognise the pleas made by the hon. Member for York (Mr. Gregory) for Bishop Auckland (Mr. Foster) and for Swindon (Mr. Coombs). The hon. Member for Swindon made a plea for his constituents, and I wish him


success. I do not believe that he will obtain any money from the European social fund. I have tried for years to obtain some for the Isle of Wight.
I hope that the Minister will listen to the hon. Member for Swindon, because he made some sensible suggestions. I hope that they have gone home.
I feel desperately sorry for Swindon. The Great Western Railway was one of my favourite railways. It is sad that that once proud line and its engineering centre are in such distress. My concern is not only about present redundancies in the British Rail workshops, which are obviously depressing to the towns that I mentioned, but about the broader issue of the re-equipment of our railway system with modern locomotives and rolling stock. It is a matter of concern not just to those employed by British Rail, its passengers and freight customers, but to the thousands of manufacturers in the private sector who supply parts for the rolling stock. I declare an interest, as one of those companies is in my constituency.
I am glad that a start is to be made on replacing the diesel multiple unit fleet of British Rail. Most of the vehicles are 25 years old. I agree that British Rail should introduce new vehicles which use fuel more efficiently and are cheaper to maintain, rather than spend large sums of money stripping asbestos out of old rolling stock. I ask for an assurance that investment funds will be made available to British Rail to complete the process of replacing all vehicles containing asbestos by the end of 1987, a point made by the hon. Member for Crewe and Nantwich (Mrs. Dunwoody). That would also help the hon. Member for Swindon in his plea.
Vital decisions have to be made concerning locomotives and rolling stock and the modernisation of primary inter-city routes from Euston to Birmingham, the north-west and Scotland. Modern high-speed trains serve the east coast main line, the midland main line and routes out of Paddington, but most of the locomotives and rolling stock on the Euston route are old and capable of running at only 100 miles per hour. The Secretary of State may think that a safer speed is 20 miles an hour. However, when he realises that competition on the motorways goes at anything up to 90 miles an hour, he will understand that speed is of the essence. Will the Minister assure the House that manufacturing capacity will still be in existence to undertake that overdue modernisation if BREL is allowed to run down? That is the vital question. Has British Rail proposed any plans for the re-equipment of the Euston route?
Another major concern is the electrification of the east coast main line. I understand from many replies from the Secretary of State and his predecessors, and what he said today, that he is waiting for the British Railways Board to submit a prospectus for the inter-city sector showing that the whole business is profitable. This is about the third attempt by British Rail—possibly the fourth or fifth—to prove that it makes sense to electrify the east coast main line. The crucial question is not whether the inter-city sector is profitable, but whether the east coast main line is. I believe that it is. Anyone who travels on it on a Friday will agree. When will a decision be made? It is no use saying that the high-speed trains on the route are comparatively new. The Minister must know that electrification will take many years to complete, by which

time new trains will be needed. Presumably they will be a follow-on to the renewal of the fleet on the west coast main line.
We must avoid a repeat of 1955, when a crash programme of re-equipment was embarked on, which the industry could not meet. Most of us in Britain want to travel on a modern, comfortable railway system, both north and south of London. Much of the rolling stock in the southern region is decrepit, to say the least. We have heard little about that. Much money could be spent on improving rolling stock on the southern region. There are four reconditioned carriages on the Portsmouth line, and I gather that that is all that we shall get for the next few years.
It is therefore necessary, for the future of the railway supply industry as well as the BREL workshops, for the Secretary of State to tell us about electrification plans and the re-equipment of the west coast main line, so that we know what orders for locomotives and rolling stock might be forthcoming, and so that we may be assured that sufficient manufacturing capacity exists to meet those demands. Otherwise, I suspect that we shall have to import from places such as Korea and even Brazil in the 1990s. It would be a sad commentary on the management of affairs by the Government if we resolved to modernise our two busiest main line railways on a time scale which coincided with the demise of our capacity to carry out the work.
I am glad to hear of the improving financial results on the railways and that more revenue is being earned. My final questions concern the financial targets which the Secretary of State has set the freight and inter-city businesses of the railway. Those targets may have much bearing on the amount of new rolling stock that is ordered by British Rail. Is the Secretary of State satisfied that the competition facing British Rail in freight and passenger services is fair in terms of the financial contribution made by the heaviest lorries and express coaches to road costs, observance of safety and other legal standards and, as far as it it possible to measure, things such as road congestion and other environmental costs?
Does the right hon. Gentleman believe that it is right that inter-city coaches should pay less than £100 for their annual road fund licence? Did he read The Sunday Times this weekend, which stated that drivers of inter-city coaches regularly exceed schedules by 90 minutes, and, by inference, must exceed permitted driving hours? Did he read in the same newspaper about damage to property caused by heavy lorries, which was apparently brought to his attention by the hon. Member for Cornwall, North (Mr. Neale)? I should like assurances that, in demanding that parts of British Rail should be profitable, the framework of competition is completely fair.
It is possible to run two types of railway with the level of support which the Government are willing to make available. The first, which is beloved of some economists in Whitehall—I accept that that breed might be in some difficulty at the moment—is that the fewest trains are run over the fewest routes at the highest fares or charges obtainable. Peaks in business are priced off by raising fares. The alternative is for British Rail to be directed to maximise the amount of traffic that it carries with the support that the Government make available. The railways are therefore much busier and use more rolling stock. That is why I am raising this matter today. Which alternative


does the Secretary of State favour? Has he discussed this issue with the chairman of British Rail? It is obvious that I support the second alternative.
Although I accept that there is over-capacity in BREL workshops, which I gather is likely to cost British Rail up to £20 million this year, I cannot support the continuing rundown of our railway system. A comprehensive programme of modernisation and expansion of passenger and freight services must be in the best interests of the country. That is why I and my colleagues will support the official Opposition in Lobby tonight.

Several Hon. Members: rose—

Mr. Speaker: Order. Before I call the next hon. Member, may I say that a considerable number of hon. Members wish to speak. I appeal for extremely brief speeches, as I understand that the Front Bench speakers wish to start replying to the debate at 9.30 pm.

Mr. Peter Thurnham: Opposition Members say that they oppose privatisation, but was it not private enterprise which set these works up? Horwich railway works, which is in the travel-to-work area which forms part of my constituency, was set up by private enterprise in 1885. In its heyday under private enterprise it employed more than 4,000 people. When I visited it last summer 1,200 people worked there. Of that number 750 have been declared redundant, but it is hoped that 400 or 500 will continue to find work in the foundry. Secure job prospects must depend on profitable working. The hon. Member for Crewe and Nantwich (Mrs. Dunwoody) does not seem to understand the Government's economic policy. I do not believe that she understands investment. An investment must yield a return. It is that return that provides the funds for more investment.
The nationalised British Rail Engineering Ltd. is highly centralised and all of the management decisions are made in Derby. As my hon. Friend the Member for Swindon (Mr. Coombs) said, the lack of a sales force can leave the works highly vulnerable to decisions which are made a long way away. BREL must work closely with its work force to ensure that 400 people—or 500 with two-shift working — are employed profitably. In the past two years the foundry lost £3 million, and this year it is hoped to break even. That is not good enough. Prices are set by competition with private firms which must make a profit and pay taxes to provide the subsidies for such losses. The reprieve which BREL hopes will last five years must be used to make the foundry truly profitable. In addition to being profitable I would like it to be privatised and to have its own sales force and independent management.
With regard to efforts to provide alternative employment, I see no reason why there should not be a profitable private carriage repair service on the Horwich site. I hope that British Rail management is big enough to go out in competition against its own BREL work force. It must be realised that new businesses cannot be set up with a wave of a wand, especially if people are not used to a commercial environment. I spoke yesterday to the director of the local enterprise agency, Bolton Business Ventures, about efforts to encourage redundant employees to consider starting in business. Of the 750 redundant people, about 180 expressed some interest. Only 63 came

forward for interview, 18 attended a "skills into business" course and 12 looked like starting up in business. Out of 750, no more than 2 per cent. look like benefiting from efforts to encourage new businesses.
As a result of the Horwich closure, Bolton's unemployment rate rose to 15·4 per cent. last year. Bolton looks for central Government help to recover and for maximum assistance both from the regional aid and urban programmes. I am pleased that Norwich has been included in the inner urban programme. Bolton looks urgently for derelict land grants which last year amounted to only £60,000, but this year we have put in a bid for £1·5 million.
Next year is the centenary of the Horwich railway works, and I hope that we can celebrate that event by a return to profitable working under private enterprise. I wish all concerned success in the task of ensuring that future employment is profitable.

Mr. Harry Cowans: I am a sponsored member of the National Union of Railwaymen and the only speaker who has worked in the industry. It is ironic to be told to speak briefly but as usual, Mr. Speaker. I shall try my hardest to comply with your request.
My complaint is against the Secretary of State. The reason that this problem arises is that the right hon. Gentleman suffers from the disease of infrequency that he inherited from his two predecessors. The previous two debates on this issue have been in Opposition time, and I understand why. Every time that we have debates on this subject we talk about dismantling services and cutbacks all over the place. It must be said that the right hon. Gentleman is largely to blame for that. We also hear that the present circumstances are the responsibility of the chairman of the British Railways Board and have nothing to do with the Secretary of State. Quite honestly, he cannot get away with that. He has talked about under-capacity, which is interesting. Do we have under-capacity because there is no remedy?
The British Railways Joint Consultative Council document states:
The NUR representatives said that they were concerned that European wagons"—
that is, the ferry wagons—
were being used, instead of BREL being asked to build a modern Train Wagon Ferry fleet for BR. It was another example of BREL's potential not being used".
Has the Secretary of State examined that? If the right hon. Gentleman is the watchdog of the taxpayer, as he says he is, surely he is entitled to examine such matters. He cannot get away with saying that it is not his responsibility because he, in line with the Government, fixes the cash limits that created most of the problems. There is no doubt about that.
We have heard much about exports, and that that might be a way out of the problem. Unfortunately, we did not hear the full story. It is very nice for Conservative Members to discuss exports, while the Government are destroying the home base and our shop window for exports. Other Governments are more conscious of their industries than our Government. Why does BREL—I am referring to an NUR document—fail to get more exports? The reason is that overseas firms, who are our competitors, tender at a figure that BREL pays for its raw materials. Raw materials across the world are about the


same price, so there must be a hidden subsidy. Other Governments care about their home industries. When they have employment debates they do not, as happens in this country, shed crocodile tears about unemployment. Our Government can do something about the problem as they have a semblance of control over nationalised industries. They have direct control as they set cash limits. When the reverse side of the coin arrives, and they can do something about the problem, they do not. With the greatest of respect, we have been hearing nonsense.
We hear talk about the Secretary of State being the watchdog of the taxpayer, the wastage of public money and other matters.
Although a submission was made to the Department of Transport on 19 April 1983—the Secretary of State is in a beautiful position to deal with this matter— a large proportion of the EMU replacement programme shown for 1985 has only just been authorised. The cost to BREL has been £4 million in under-utilisation. If that was the basis on which BR has argued the closure of Shildon and Horwich, is not the Secretary of State contributing to the closure of Horwich? Is he acting as the watchdog of the public purse when the Government delay so long that £4 million is wasted? Could not that sum have done something for Shildon, Swindon or Horwich? Of course it could. Is it any use having this debate? If the Secretary of State is not responsible for these matters, he should get out so that we can talk to someone who is responsible.
Section 8 grants do not apply to BREL, only to firms applying for wagons. BREL cannot take advantage of section 8 when building its fleet. The Government talk about fair and unbiased competition, but they do not know the meaning of that.

Dr. John Marek: I know a perfect example of how money could be used to save the jobs of BREL workers. A survey of time-keeping of trains was carried out at Wrexham station over a 12 week period, covering 639 trains. One in three was more than 10 minutes late on the down line. There is an inter-city service once a day. Clwyd county coucil paid more than £50,000 introducing that service in an attempt to attract industrial development to the area. Yet one in three of those trains was more than 20 minutes late. Does my hon. Friend agree—

Mr. Speaker: Order. The hon. Gentleman is making a speech rather than an intervention.

Dr. Marek: Does my hon. Friend the Member for Tyne Bridge (Mr. Cowans) agree that I have given an excellent example? We have a rotting railway system because of lack of investment in new rolling stock and in permanent way. We have the facilities to remedy that position, but the Government are doing nothing about it.

Mr. Cowans: In the interests of brevity, I can only say that I agree with my hon. Friend. We could spend three or four hours on that subject, but I shall not do so.
It is strange that we hear the same impassioned plea for Swindon and Shildon from opposite sides of the House. The difference is that Labour Members support policies that would bring about the necessary change, while Conservative Members support policies that have brought about the redundancies. Perhaps the electors of Swindon

should learn a lesson from that because they have put their trust in false promises. My goodness, the hidden Conservative manifesto is now coming out, and I hope that the Swindon electorate recognise that.
Of course, the blame is always put on BR management, yet the BR programme prior to the cuts actually called for an increase in the BREL workforce from 38,000 to 43,000. But once the Secretary of State, who says he has no responsibility for these matters, introduced the accelerated cuts, Shildon, Horwich and umpteen other places were hit.
The downgrading of the vital asbestos stripping programme will mean that a larger number of contaminated wagons —84 per cent. — will remain in service, despite the risk to the public. The Secretary of State cannot deny that there will be a gap between the arrival of the new coaches and the ending of asbestos stripping. It is a simple case of scrimping to make savings.
Safety standards are being reduced day after day, yet the Secretary of State does not appear to be aware of that. He should walk around southern region, which has clapped- out stock. Even Conservative Members who have constituencies in the southern region area know that the stock is clapped out.
The Secretary of State used the argument that modern stock needs less maintenance. A complete overhaul is needed on southern region stock every 100,000 miles, but that figure has now been raised to 150,000, which means reduced maintenance. Safety standards are being cut to meet the Government's cost limits. It is nonsense for the Secretary of State to say that he knows nothing about that.
If this debate had been taking place in Committee, when the Secretary of State could give more time for debate, I would make many more points. I hope that he and I will meet in Committee, when much more time will be available.
Great emphasis is laid by the Government and Conservative Members who have spoken in the debate on added efficiency—"Work harder, lads, and you'll be all right. It's inefficiency that is losing you jobs." In the last three years, Shildon increased its efficiency by 9 per cent., 6 per cent. and 5 per cent. The reward of the workers was the sack, so how can hon. Members tell the work force to increase its efficiency? Shildon was held as the jewel in the crown, and the Government's reward to that area was the sack.
A number of people work at Shildon and live in Durham. I should like here to send out a message from the House, because it is important that people know what takes place in the House. During the general election, in an area where cuts are common and redundancies are being made at Doncaster, the Tory candidate issued a public statement saying that he had had an assurance from the then Secretary of State that the future of the Doncaster workshop was guaranteed. There is undoubtedly a guarantee, but what is guaranteed is closure, without any shadow of doubt. The Government have that responsibility resting on their shoulders, and it does no good for the Government to say that it is the fault of the chairman of the British Rail board, because he is put in that position

Mr. Tom Sackville: My hon. Friend the Member for Bolton, North-East (Mr. Thurnham) has already referred to the tragic end of a proud railway


tradition in Horwich where 5,000 men were once employed in the workshops and where 50,000 steam locomotives were repaired between 1888 and 1957.
I should like briefly to remind the Secretary of State of the responsibilities that he and British Rail Engineering undertook when they sanctioned the closure of Horwich. I wish to refer in particular to a meeting on 6 July 1983 between a delegation from the Horwich action committee, the Under-Secretary of State for Transport and officials of other Departments. At that meeting, it was promised that, in the aftermath of closure at Horwich, special consideration would be given to requests for Government aid in the Horwich area, in particular special consideration to derelict land grant for parts of the 150-acre site that may become derelict in time, and consideration of urban development grant. It was promised that the part of Bolton metropolitan borough surrounding Horwich would be eligible for inner urban aid. So far very little of the fruit of this promise has been seen, and I should like to remind the right hon. Gentleman of this.
Secondly, I wish to remind the Secretary of State that directors of British Rail Engineering have at different times promised that large sums of investment will be available for new schemes aimed at employing some of the 1,000 workers recently made redundant at Horwich. As the House has heard, Bolton Business Ventures is ready to channel funds into suitable schemes that may come up. I wish to ask the Secretary of State to remember this, and to remind British Rail Engineering of its responsibilities in this matter.

Mrs. M. Beckett: In the brief time that remains, I shall attempt to outline the main points of the problem as it affects Derby, where two of the works under discussion are situated in my constituency.
Reference has been made in speeches by Conservative Members, and indeed in the Government amendment to efficiency. How can there be efficiency where there is uncertainty compounded by doubt and decisions that are changed day by day and almost minute by minute? Work that is promised is reduced, or disappears entirely. Work that remains is not secured to BREL, but will be open to competitive tender. Orders are mentioned, shimmering like a mirage in the distance, but before they appear they disappear. Dates are not applied, and no firm orders are placed. In this climate the Secretary of State talks about efficiency.
The decisions come out of the blue. I understand that the works management of the Derby works knew nothing about the redundancies until they heard of them on the news or read about them in the local newspapers. The decisions to stop stripping asbestos similarly came out of the blue before Christmas. The decision to stop any apprenticeships being taken on this year came out of the blue to the extent that some of the 80 youngsters scheduled for appointment in Derby had already been interviewed. They were at home waiting and wondering whether they had made a good enough impression, whether they were fit to be among those selected, only to discover that, however fit and good and well-trained they were, there was no future for them in British Rail or in Derby. There have been not only abrupt but negative decisions time after time. The cutbacks already announced mean more than 600 redundancies in Derby, and no future for the young

people of the area in BR, whereas often in the past they have looked in that direction for proper and sensible training.
The Government claim that none of the criticisms that my hon. Friends and I make flow from Tory policies; that safety is not endangered by fewer maintenance checks; that previous decisions to strip asbestos from coaches now being treated at Litchurch lane and elsewhere are no longer necessary because apparently the threat from asbestos has somehow evaporated; and they claim, most of all, that the changes in approach that BR has made to investment have nothing to do with the Government—that they have no connection with the financial restrictions that the Government have placed on BR—and that the fact that the Secretary of State has asked BR to secure its targets two years earlier has nothing to do with the investment now called for by BR.
I quote some words that belie the Secretary of State's argument. The BR annual report and accounts for 1979 said:
Without increasing investment, standards will continue to drop. Only 16 locomotives were built in 1979 out of a total fleet of 2,000 which need replacement.
The annual report and accounts for 1980 said:
The Board is concerned at its inability regularly to renew its assets, through the double constraints of investment ceilings and finance limits. The opportunity to replace assets in an economic and orderly way is slipping away.
It went on:
By 1983, beyond that watershed year—although we can make do and mend—there will be a rapid rundown of the system.
In 1982, BR's annual report and accounts said:
Electrification must be synchronised to take over from the worn-out diesel fleet in the next decade. To do that, it must start now and be continuous.
Those are the phrases of a board that sees the need for investment in the rail system, that sees the system in continuing decline, that sees decrepit carriages and locomotives that are unfit for their job and sees the need for an investment plan of the kind that the Opposition have identified today. Yet the Secretary of State blandly tells us that the financial limits that the Government have set, and the way in which they have approached investment, have nothing to do with the complete change of heart on the part of British Rail.
Whoever travels by train is aware of the need for new stock. Whoever considers the overall interests of our transport system knows that we need the efficient British Rail for which we are calling and that that can be provided only by the policies that we have identified. Only this Tory Government, who seem to know the price of everything but the value of nothing, are too short-sighted to provide the investment that BR needs.

Mr. Greg Knight: We owe it to those who are employed by BREL and on the railways to have a debate that is free of false promises and blinkered vision. The hon. Member for Crewe and Nantwich (Mrs. Dunwoody) made a speech which was excellent in its presentation but breathtaking in its inaccuracy.
I am concerned about the fact that in Derby it is likely that 600 people will lose their jobs. However, I am also concerned about the remaining 6,000 and what we can best do to secure their long-term future.
I am concerned, as are many of my hon. Friends. about the Labour party's argument that somehow the problems


of BREL exist only because we have a Conservative Government. We should look at those assertions. Following the Transport Act 1962 the British Railway's workshops division was formed, with 32 works employing 66,000 staff. In the first five years that was cut to 16 works with 36,000 staff. I hope that it will not have escaped the attention of Labour Members that during most of that period we had a Labour Government. Were they to blame then, or was it the case that the introduction of diesel traction and diesel multiple units meant that far less maintenance was necessary?
The statistic that has shot through every argument used by Labour Members is one which they cannot escape. It is that four out of every five people employed by BREL are employed in maintenance.

Mrs. Beckett: They are not building anything.

Mr. Knight: It has nothing to do with not building anything. Mark III coaches need to be maintained only every three years and not—like mark II coaches—every 18 months. British Rail is using freight wagons that carry 36 tonnes and make three journeys a day, whereas a few years ago the wagons would carry only 16 tonnes.
Change is inevitable. The hon. Member for Derby, South (Mrs. Beckett) quoted from the report from BREL. I do likewise, from what the chairman said:
The Company's future must be based on a correct match between future workload on the one hand and workshop capacity and manning levels on the other. Quite simply, we have twelve Works but at the productivity levels we seek, the forecast workloads can be accommodated in nine. The solution is painful, but essential.
Where change involves people's livelihoods, it is a difficult and painful process. Those of us who care about the future of our railways know that the progress to greater efficiency is essential. That is something that must be grasped.

Mr. Michael J. Martin: The Glasgow, Springburn railway workshops are the only workshops in Scotland. In Scotland, our steel, coal and shipbuilding industries have been threatened with closure. Close Springburn, and we have no railway engineering workshops as well. One of the only factories in the west of Scotland which employs apprentices is saying that there will not be any intake or training for the future in skills. The Government are always saying that there will be an upturn in the economy. I can remember past upturns in the economy, which meant that we needed skilled men and women to fill skilled jobs. How will we get skilled workers if we do not train them? If we cannot train them in the nationalised industries, we cannot train them anywhere.
It is madness that the only Scottish BR workshop is controlled by Derby. There should be a link-up with the Scottish region, because geographically it is one of the most difficult areas in the country to operate, and we know that from the terrible weather that we are having at the moment. If it were not for the skill and dedication of the railway workers, we should have lost more lives than we have done in the past few days.
It is nonsense that although the biggest customer that the railway workshop has in Scotland is the Scottish region, there is no direct control over the workshop. I ask the Minister to think seriously about the social

consequences, and the consequences for the Scottish economy, if anything happened to the railway workshops. He should consider what I said about the link-up with the British Rail workshops.

Mr. Peter Snape: In the comparatively short time that has been available to us, we have had an interesting debate. Hon. Members on both sides have expressed their opinions in fairly forthright terms. The burden of the Government's case, particularly in relation to British Rail Engineering Ltd, is that the industry is sadly rooted in the past, and that because of the pace of change in the industry the number of people needed to maintain railway behicles and to build new rolling stock and new locomotives is sadly but inevitably less. The Secretary of State said as much. He described the situation in BREL as part of the pace of industrial change.
If that is true, how is it that my hon. Friend the Member for Kingston upon Hull, East (Mr. Prescott) and others quote from a document produced by the British Railways Board three short years ago, in which it talked about the expansion that is necessary within BREL, and the need to recruit over 1,000 extra staff to cope with the ever-expanding work load and the projected new build and maintenance in the 1980s?
If what the Secretary of State said about the pace of industrial change is true, there appears to have been a fairly widespread misjudgment—to say the least— by someone, because within three years that all changed. We are now told that there is no work for these people, the industry has changed its practices, maintenance work takes place at less frequent intervals, and so these redundancies are sadly inevitable. We do not believe that, and in the short time that is available to me I shall attempt to show why we believe that.
The right hon. Gentleman mentioned safety in his speech. He as good as accused my hon. Friend the Member for Kingston upon Hull, East of dangerous scaremongering about railway safety. No one would ever accuse the right hon. Gentleman of great devotion to accuracy, and sure enough, in the sweeping statement that he made earlier, in the laconic way to which we have rapidly become accustomed every time he opens his mouth, he again got it wrong.
Shortly after the publication of the Serpell report, the board had quite a few things to say about safety in the railway industry. Its report on safety began with a long extract from the 1981 report of the chief inspecting officer for railways, which said that
the railway is not unsafe".
The board went on to say:
This is as it should be. At no time have we said that the railway is becoming unsafe nor would the engineering profession knowingly allow this to happen whatever the financial pressures".
However, the board said, in the same statement:
despite detailed standards of safety, the disproportionate aging of equipment reduces the built in safety margin and places upon many thousands of engineers, supervisors and other staff an increased responsibility for fine judgment of margins. All of these are trained to take decisions and do so, but the chance of error increases as the safety margins decrease…Alternatively, the excessively cautious approach leads to operational disruption".
Perhaps the right hon. Gentleman does not think that that is particularly relevant to railway safety. Certainly the British Railways Board does.
While I am on the subject of safety, I refer to something else that the right hon. Gentleman said when he talked about asbestos stripping from diesel multiple units. This matter was mentioned by the hon. Member for Swindon (Mr. Coombs), as well as by my hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody) in a particularly able speech. Many of us have spent much of our lives—in my case, it is no great secret that I have spent all my working life—in the railway industry think that safety is of paramount importance.
It has been pointed out that no passenger has lost his life in a moving traffic accident on British Rail during the past two years, but that does not mean that accidents and collisions have not accurred. Indeed, in the last year for which statistics are available, 1982, there were more than 60 accidents, many minor, involving passenger trains. Many of those trains were obviously diesel multiple units incorporating blue asbestos because there are 1,800 DMUs operating on British Rail which have not been stripped of blue asbestos.
On safety and the correctness of BREL's decision to stop the stripping of blue asbestos, I do not wish to be accused by the right hon. Gentleman of scaremongering because I care too much about the railway industry. However, if a collision, like the one a few weeks ago outside Paddington station when only three people were slightly injured despite the high speed of the train, involving a diesel multiple unit with blue asbestos took place at speed I do not think any of us could guarantee the safety of passengers, crew or those attending the collision because of the danger from blue asbestos. That is one reason why we are concerned about the overnight decision taken by BREL in November to cancel the programme.
We are told by the Secretary of State that BR is more interested in putting new diesel units into service to replace the old. He let something slip during his speech. He said that an application from British Rail had arrived yesterday asking him to consider the introduction of some diesel multiple units — I do not know the exact number —presumably to replace those that have been in service from the 1950s. If that application takes as long to approve as some that have been kicking around the Department in recent years, there is not much hope of getting rid of diesel multiple units containing blue asbestos by the target date, which is either 1986 or 1987.
Yet more than 700 people are to lose their jobs because of the overnight cancellation of the project. Many jobs will be lost at Swindon. The policies being pursued by the Government, particularly by the Secretary of State, virtually doom Swindon works to closure within the next few years. I say that with no pleasure and to make no political point. If the hon. Member for Swindon believes as strongly as he seems to in the efficiency of his work force, he should be in the Division Lobby with my hon. Friends and myself tonight; I address those remarks equally to the hon. Member for York (Mr. Gregory). If the policies of the Government on the railway industry continue for the time that the Government sadly have to serve, the number of closures so far and the projected redundancies within BREL are but a fraction of those that will affect the industry by the end of this Parliament.
I congratulate my hon. Friend the Member for Bishop Auckland (Mr. Foster) on the plea he made on behalf of the work force who may lose their jobs at Shildon. The excuse for that closure is changing traffic patterns. The

hon. Member for Derby, North (Mr. Knight) said that modern wagons made three journeys where previously wagons had made only one. That is true as far as it goes, but it does not go far. If we consider British Rail's attitude towards freight since the mid-1960s, we see that there has been a drastic alteration in the management's policy towards the acceptance of traffic to be carried by rail. That has meant inevitably that British Rail has the lowest number of freight vehicles in its history. The number of rail freight vehicles is at its lowest level for over a century That is because of the conscious decision of British Rail management in the past few years to move out of wagonload traffic and to concentrate exclusively on high-speed block trains. That means inevitably that our roads are evert more congested and that lorry weights become heavier and heavier. The Minister who talks about the need for profitability and for the railway industry to break even is the same Minister who authorises 38-tonne lorries, despite the damage that they do to roads and bridges. 'That is damage for which the taxpayer pays and not the road haulage industry. My hon. Friends who represent Welsh constituencies are demanding a second crossing of the Severn as a result of that policy.
The Government's transport policies are the policies of bedlam and madness and the Secretary of State gives us no encouragement to hope that the policies can be checked. There is little hope for those who work within BREL and for those who work in the main business. Their future is set out starkly in a short article that appeared in yesterday's edition of The Times, which was written by the hon. Member for Derbyshire. West (Mr. Parris) as a result of his expedition to the north-east to see what life, if not love, on the dole is like in the 1980s. The hon. Gentleman wrote:
Is there any way you can tell a man that his industry his job and his family are necessary, even glorious, casualties in the battle to transform the British economy and to revolutionise social attitudes?
It is a strange transformation that condemns even more thousands of men to the dole queue and destroys a once great industry. Neither the British people generally nor those who work in the industry will forgive the Government for the direction in which they are travelling, and none of us in the House who has had the misfortune to listen to the Secretary of State will forgive him.

The Under-Secretary of State for Transport (Mr. David Mitchell): The debate has been a curious mixture of serious questions and concern about the future of jobs in BREL and unfortunate politicking by the Opposition Front Bench. The latter makes me angry, because a deliberate attempt is being made to persuade the members of the work force and their wives that some magic wand could remove the problem of redundancies. That cannot be done, as I shall seek to explain to the House. First, I shall deal with the serious questions that have been asked by a number of hon. Members.
If I have any creditials, it is that I am deeply concerned about the problems of BREL and of British Rail. I am very much a pro-rail Minister and I am deeply concerned about job losses. I have already visited the BREL works at Litchurch lane, Eastleigh, Doncaster, York, Crewe and, yesterday, Swindon. I do not believe that one can get an understanding of the problems that arise by sitting behind a desk in Whitehall, and that is why I have been getting out.
I have been impressed by the skills, the dedication and the anxieties of those who work in the industry. The Opposition spokesman who opened the debate, the hon. Member for Kingston upon Hull, East (Mr. Prescott), argued that the situation had come about principally because the Government had denied British Rail the investment that it needed. That is untrue. Only one investment request from British Rail is now being held by the Government. No others have been delayed or put back, except for the one which was received last night through the post. I do not think that the House would expect us to have turned that round already. The only other request that is now held is that of the east coast main line electrification scheme.

Mr. Prescott: That is the main one.

Mr. Mitchell: We are waiting for further information from British Rail. When that is forthcoming we shall decide what to do in the most businesslike manner possible. We shall act as quickly as we reasonably can. British Rail is not held back with respect to investment. The Government will welcome BR's proposals for investment in sound propositions, and I look forward to receiving them.

Mr. Snape: Aha!

Mr. Mitchell: The hon. Member for West Bromwich, East (Mr. Snape) says, "Aha". Does he expect the Government not to protect the taxpayer? Does he expect the Government to chuck away money on measures which are not soundly appraised? Of course he does not.

Mr. Snape: Is the Under-Secretary aware that Mr. John Palmer, a deputy secretary at the Department of Transport, signed the report on electrification, published last year, which urged the go-ahead for such schemes?

Mr. Mitchell: The hon. Gentleman does not have the matter entirely right. If he looks at the report in its context he will see that it had much to do with the future of intercity, and I shall return to that if there is time.
The reverse of the Opposition's claim is true. They have said that there is a lack of investment, but investment in new rolling stock, which is faster—therefore less rolling stock is required—and needs less maintenance means less standby rolling stock and less work for BREL in terms of overhauling, maintenance and the like.
I sympathise with those at Shildon. The modern wagon fleet is more than eight times as efficient and productive as the old fleet, and therefore considerably fewer wagons are required. Do we want an efficient competitive BR, investing in modern rolling stock at competitive prices, or a BR weighed down and unable to compete because of the burden of carrying surplus capacity in the workshops?
The hon. Member for Crewe and Nantwich (Mrs. Dunwoody) agreed on one point — that the BR workshops are a pool of precious skills. When going around the Crewe works, I was impressed by the standard of skill. The hon. Lady said that the Government had starved BR of investment, but the Government have invested £1,500 million in BR since 1979, and between now and 1988 will invest £2,000 million. I have announced at the Dispatch Box investments for Tonbridge-Hastings electrification, Cambridge electrification, 149 new electrical multiple units and, last week, 150 railbuses.

Part of the problem which the hon. Lady and the Opposition have not faced is that investment in those projects deprives BREL of the work of rehabilitating the old rolling stock which will no longer be required.

Mrs. Dunwoody: When?

Mr. Mitchell: The hon. Lady referred to asbestos stripping, as did the hon. Members for Isle of Wight (Mr. Ross) and for West Bromwich, East. I was asked whether there was a timetable for the replacement of the asbestos-carrying diesel multiple units, how soon they would be replaced and whether their replacement would mean that there was no need for an asbestos-stripping programme. The exact timing is a matter for BR's management, but there is an agreement with the trade unions that by 1987 all asbestos-carrying stock will be removed, and therefore there will be a programme of replacements starting with the 150 railbuses to which I referred last week, possibly carrying on with the further 100 for which BR applied yesterday.

Mr. Cowans: What about the appraisal?

Mr. Mitchell: I cannot answer a question about an investment appraisal received last night. It would mean about 250 in total. On that basis, there will be ample time for BR to replace the entire number from the fleet that has—

Mr. Cowans: Will the hon. Gentleman give way?

Mr. Mitchell: I cannot give way, because time is running hard against me.
The hon. Member for Bishop Auckland (Mr. Foster) asked what happened to the order for 700 wagons to be purchased with grant available under section 8 of the Transport Act. It has gone out to competitive tender. That is a matter for those purchasing the wagons. He claimed that Shildon was starved of orders, but if my memory is correct the works had a capacity of 1,500 wagons per year whereas the demand was for about 150. Vast unused capacity cannot be carried indefinitely. The choice for BREL management was to transfer the remaining work to other works such as Doncaster or to leave all the other works also with surplus capacity for which BR had to pay, dragging down the competitiveness of the entire network by seeking to carry underused and unwanted capacity for which there were no prospects because of the greater productivity of modern rolling stock. With regard to job creation, I believe that the Shildon and Sedgefield development agency is actively seeking a buyer for the works and discussions are currently underway with BREL. I shall be happy to discuss the matter further with the hon. Gentleman if he thinks that more can be done.
My hon. Friend the Member for Swindon (Mr. Coombs) spoke movingly of the position of the work force in the works that I visited yesterday and of his own acute unhappiness, although he realistically recognised that new investment was good for BR even if it was bad for Swindon in the current circumstances. As I told the deputation of shop stewards there yesterday, BREL is in business to meet BR's requirements. It is BR's needs which decide the work load, not the possibility of jobs within BREL itself.
The hon. Member for Derby, South (Mrs. Beckett) complained of uncertainty about future BR orders due to its going to competitive tender. That makes BREL no different from the vast bulk of British industry which


secures business for its workers by seeking competitively to win orders. The trade unionists in BREL whom I have met not only regard that as fair and proper but expect to win a large slab of the orders.
My hon. Friend the Member for Derby, North (Mr. Knight) rightly stressed that the rundown in BREL began years ago and had nothing to do with the change in Government.
My hon. Friend the Member for York (Mr. Gregory) spoke up for the York works in his usual robust way. As he rightly said, BREL is redefining its relationship with BR. It now has its own design team. It is increasing its exports and actively seeking further export orders and my hon. Friend expects the York work force to mount a formidable challenge both at home and abroad.
It is not in the long-term interests of BREL to remain dependent on and dominated by one customer. The management of BREL does not want that anyway. We need a competitive railway engineering industry in this country which can supply British Rail efficiently and win overseas orders. Why does our industry currently win so few overseas orders when we were the pioneers of the railway industry? There is a great new area of export opportunity for BREL, but it will be far more easily won when BREL is efficiently separated from BR and wins its orders competitively. The Opposition have based their attack on the wrong—

Mr. Snape: rose in his place and claimed to move, That the Question be now put.

Question, That the Question be now put, put and agreed to.

Question put accordingly, That the original words stand part of the Question:—

The House divided: Ayes 198, Noes 296.

Division No. 135]
[9.59 pm


AYES


Alton, David
Coleman, Donald


Anderson, Donald
Concannon, Rt Hon J. D.


Archer, Rt Hon Peter
Conlan, Bernard


Ashley, Rt Hon Jack
Cook, Frank (Stockton North)


Ashton, Joe
Cook, Robin F. (Livingston)


Atkinson, N. (Tottenham)
Corbett, Robin


Bagier, Gordon A. T.
Corbyn, Jeremy


Banks, Tony (Newham NW)
Cowans, Harry


Barnett, Guy
Cox, Thomas (Tooting)


Barron, Kevin
Craigen, J. M.


Beckett, Mrs Margaret
Crowther, Stan


Beith, A. J.
Cunliffe, Lawrence


Bell, Stuart
Cunningham, Dr John


Bennett, A. (Dent'n &amp; Red'sh)
Davies, Ronald (Caerphilly)


Bermingham, Gerald
Davis, Terry (B'ham, H'ge H'l)


Bidwell, Sydney
Deakins, Eric


Blair, Anthony
Dewar, Donald


Boothroyd, Miss Betty
Dobson, Frank


Boyes, Roland
Dormand, Jack


Brown, Gordon (D'f'mline E)
Douglas, Dick


Brown, Hugh D. (Provan)
Dubs, Alfred


Brown, N. (N'c'tle-u-Tyne E)
Dunwoody, Hon Mrs G.


Brown, R. (N'c'tle-u-Tyne N)
Eadie, Alex


Brown, Ron (E'burgh, Leith)
Eastham, Ken


Bruce, Malcolm
Edwards, Bob (W'h'mpt'n SE)


Callaghan, Jim (Heyw'd &amp; M)
Ellis, Raymond


Campbell-Savours, Dale
Evans, loan (Cynon Valley)


Canavan, Dennis
Evans, John (St. Helens N)


Carlile, Alexander (Montg'y)
Ewing, Harry


Carter-Jones, Lewis
Fatchett, Derek


Clark, Dr David (S Shields)
Faulds, Andrew


Clarke, Thomas
Field, Frank (Birkenhead)


Clay, Robert
Fields, T. (L'pool Broad Gn)


Cocks, Rt Hon M. (Bristol S.)
Fisher, Mark


Cohen, Harry
Flannery, Martin





Foot, Rt Hon Michael
Millan, Rt Hon Bruce


Forrester, John
Miller, Dr M. S. (E Kilbride)


Foster, Derek
Mitchell, Austin (G't Grimsby)


Foulkes, George
Morris, Rt Hon A. (W'shawe)


Fraser, J. (Norwood)
Morris, Rt Hon J. (Aberavon)


Freeson, Rt Hon Reginald
Nellist, David


Freud, Clement
Oakes, Rt Hon Gordon


George, Bruce
O'Brien, William


Gilbert, Rt Hon Dr John
O'Neill, Martin


Godman, Dr Norman
Park, George


Golding, John
Parry, Robert


Gould, Bryan
Patchett, Terry


Gourlay, Harry
Pendry, Tom


Hamilton, James (M'well N)
Penhaligon, David


Hardy, Peter
Pike, Peter


Harman, Ms Harriet
Powell, Raymond (Ogmore)


Hart, Rt Hon Dame Judith
Prescott, John


Haynes, Frank
Radice, Giles


Healey, Rt Hon Denis
Randall, Stuart


Heffer, Eric S.
Redmond, M.


Hogg, N. (C'nauld &amp; Kilsyth)
Rees, Rt Hon M. (Leeds S)


Holland, Stuart (Vauxhall)
Richardson, Ms Jo


Home Robertson, John
Roberts, Allan (Bootle)


Howell, Rt Hon D. (S'heath)
Roberts, Ernest (Hackney N)


Howells, Geraint
Robertson, George


Hoyle, Douglas
Rooker, J. W.


Hughes, Mark (Durham)
Ross, Stephen (Isle of Wight)


Hughes, Robert (Aberdeen N)
Rowlands, Ted


Hughes, Roy (Newport East)
Ryman, John


Hughes, Sean (Knowsley S)
Sedgemore, Brian


Janner, Hon Greville
Sheerman, Barry


Jenkins, Rt Hon Roy (Hillh'd)
Sheldon, Rt Hon R.


John, Brynmor
Shore, Rt Hon Peter


Jones, Barry (Alyn &amp; Deeside)
Short, Ms Clare (Ladywood)


Kaufman, Rt Hon Gerald
Short, Mrs H.(W'hampt'n NE)


Kennedy, Charles
Silkin, Rt Hon J.


Kinnock, Rt Hon Neil
Skinner, Dennis


Kirkwood, Archibald
Smith, C.(Isl'ton S &amp; F'bury)


Lambie, David
Smith, Rt Hon J. (M'kl'ds E)


Leadbitter, Ted
Snape, Peter


Leighton, Ronald
Soley, Clive


Lewis, Ron (Carlisle)
Spearing, Nigel


Lewis, Terence (Worsley)
Stott, Roger


Litherland, Robert
Strang, Gavin


Lloyd, Tony (Stretford)
Straw, Jack


Lofthouse, Geoffrey
Thomas, Dafydd (Merioneth)


Loyden, Edward
Thomas, Dr R. (Carmarthen)


McCartney, Hugh
Thompson, J. (Wansbeck)


McDonald, Dr Oonagh
Thorne, Stan (Preston)


McGuire, Michael
Tinn, James


McKay, Allen (Penistone)
Torney, Tom


McKelvey, William
Wallace, James


Mackenzie, Rt Hon Gregor
Warden, Gareth (Gower)


Maclennan, Robert
Wareing, Robert


McNamara, Kevin
Weetch, Ken


McTaggart, Robert
Welsh, Michael


Madden, Max
White, James


Marek, Dr John
Williams, Rt Hon A.


Marshall, David (Shettleston)
Winnick, David


Martin, Michael
Woodall, Alec


Mason, Rt Hon Roy
Wrigglesworth, Ian


Maxton, John
Young, David (Bolton SE)


Maynard, Miss Joan



Meadowcroft, Michael
Tellers for the Ayes:


Michie, William
Mr. Don Dixon and


Mikardo, Ian
Mr. John McWilliam.




NOES


Adley, Robert
Baker, Kenneth (Mole Valley)


Aitken, Jonathan
Baker, Nicholas (N Dorset)


Alexander, Richard
Baldry, Anthony


Amery, Rt Hon Julian
Banks, Robert (Harrogate)


Amess, David
Batiste, Spencer


Ancram, Michael
Beaumont-Dark, Anthony


Arnold, Tom
Bellingham, Henry


Ashby, David
Bendall, Vivian


Aspinwall, Jack
Benyon, William


Atkins, Rt Hon Sir H.
Berry, Sir Anthony


Atkins, Robert (South Ribble)
Bevan, David Gilroy


Atkinson, David (B'm'th E)
Biffen, Rt Hon John






Biggs-Davison, Sir John
Greenway, Harry


Blaker, Rt Hon Sir Peter
Gregory, Conal


Body, Richard
Griffiths, E. (B'y St Edm'ds)


Bonsor, Sir Nicholas
Griffiths, Peter (Portsm'th N)


Boscawen, Hon Robert
Grist, Ian


Bottomley, Peter
Ground, Patrick


Bowden, A. (Brighton K'to'n)
Grylls, Michael


Bowden, Gerald (Dulwich)
Gummer, John Selwyn


Boyson, Dr Rhodes
Hamilton, Hon A. (Epsom)


Braine, Sir Bernard
Hamilton, Neil (Tatton)


Brandon-Bravo, Martin
Hampson, Dr Keith


Bright, Graham
Hanley, Jeremy


Brinton, Tim
Hannam, John


Brittan, Rt Hon Leon
Hargreaves, Kenneth


Brooke, Hon Peter
Harris, David


Bruinvels, Peter
Harvey, Robert


Bryan, Sir Paul
Haselhurst, Alan


Buchanan-Smith, Rt Hon A.
Havers, Rt Hon Sir Michael


Buck, Sir Antony
Hawkins, C. (High Peak)


Bulmer, Esmond
Hawksley, Warren


Burt, Alistair
Hayes, J.


Butcher, John
Hayhoe, Barney


Butterfill, John
Hayward, Robert


Carlisle, John (N Luton)
Heath, Rt Hon Edward


Carlisle, Kenneth (Lincoln)
Heathcoat-Amory, David


Carttiss, Michael
Henderson, Barry


Chalker, Mrs Lynda
Heseltine, Rt Hon Michael


Channon, Rt Hon Paul
Hickmet, Richard


Chapman, Sydney
Hicks, Robert


Churchill, W. S.
Higgins, Rt Hon Terence L.


Clark, Hon A. (Plym'th S'n)
Hill, James


Clark, Dr Michael (Rochford)
Hind, Kenneth


Clark, Sir W. (Croydon S)
Hirst, Michael


Clarke, Kenneth (Rushcliffe)
Hogg, Hon Douglas (Gr'th'm)


Clegg, Sir Walter
Holland, Sir Philip (Gedling)


Cockeram, Eric
Holt, Richard


Colvin, Michael
Hooson, Tom


Coombs, Simon
Hordern, Peter


Cope, John
Howarth, Alan (Stratf'd-on-A)


Corrie, John
Howarth, Gerald (Cannock)


Couchman, James
Howe, Rt Hon Sir Geoffrey


Cranborne, Viscount
Howell, Rt Hon D. (G'ldford)


Critchley, Julian
Howell, Ralph (N Norfolk)


Crouch, David
Hubbard-Miles, Peter


Currie, Mrs Edwina
Hunt, John (Ravensbourne)


Dorrell, Stephen
Hurd, Rt Hon Douglas


Douglas-Hamilton, Lord J.
Irving, Charles


Dover, Denshore
Jackson, Robert


Dunn, Robert
Jenkin, Rt Hon Patrick


Edwards, Rt Hon N. (P'broke)
Jessel, Toby


Eggar, Tim
Jones, Gwilym (Cardiff N)


Emery, Sir Peter
Jones, Robert (W Herts)


Evennett, David
Joseph, Rt Hon Sir Keith


Eyre, Sir Reginald
Key, Robert


Fallon, Michael
King, Rt Hon Tom


Farr, John
Knight, Gregory (Derby N)


Favell, Anthony
Knowles, Michael


Fenner, Mrs Peggy
Knox, David


Finsberg, Sir Geoffrey
Lamont, Norman


Fletcher, Alexander
Lang, Ian


Fookes, Miss Janet
Latham, Michael


Forman, Nigel
Lawler, Geoffrey


Forsyth, Michael (Stirling)
Lawson, Rt Hon Nigel


Forth, Eric
Leigh, Edward (Gainsbor'gh)


Fowler, Rt Hon Norman
Lennox-Boyd, Hon Mark


Fox, Marcus
Lester, Jim


Fraser, Peter (Angus East)
Lewis, Sir Kenneth (Stamf'd)


Freeman, Roger
Lightbown, David


Fry, Peter
Lilley, Peter


Gale, Roger
Lloyd, Ian (Havant)


Galley, Roy
Lloyd, Peter, (Fareham)


Gardiner, George (Reigate)
Lord, Michael


Gardner, Sir Edward (Fylde)
Lyell, Nicholas


Garel-Jones, Tristan
McCrindle, Robert


Gilmour, Rt Hon Sir Ian
McCurley, Mrs Anna


Glyn, Dr Alan
Macfarlane, Neil


Goodlad, Alastair
MacGregor, John


Gow, Ian
MacKay, Andrew (Berkshire)


Gower, Sir Raymond
MacKay, John (Argyll &amp; Bute)


Grant, Sir Anthony
Maclean, David John.





Macmillan, Rt Hon M.
Prentice, Rt Hon Reg


McNair-Wilson, P. (New F'st)
Proctor, K. Harvey


McQuarrie, Albert
Raffan, Keith


Madel, David
Raison, Rt Hon Timothy


Major, John
Rathbone, Tim


Malins, Humfrey
Rees, Rt Hon Peter (Dover)


Malone, Gerald
Renton, Tim


Maples, John
Rhodes James, Robert


Marland, Paul
Rhys Williams, Sir Brandon


Marlow, Antony
Ridley, Rt Hon Nicholas


Marshall, Michael (Arundel)
Ridsdale, Sir Julian


Mates, Michael
Rifkind, Malcolm


Mather, Carol
Roberts, Wyn (Conwy)


Maude, Francis
Roe, Mrs Marion


Mawhinney, Dr Brian
Rost, Peter


Maxwell-Hyslop, Robin
Rowe, Andrew


Mayhew, Sir Patrick
Rumbold, Mrs Angela


Merchant, Piers
Ryder, Richard


Meyer, Sir Anthony
Sackville, Hon Thomas


Miller, Hal (B'grove)
Shaw, Giles (Pudsey)


Mills, lain (Meriden)
Shaw, Sir Michael (Scarb')


Mills, Sir Peter (West Devon)
Silvester, Fred


Miscampbell, Norman
Sims, Roger


Mitchell, David (NW Hants)
Skeet, T. H. H.


Moate, Roger
Smith, Sir Dudley (Warwick)


Monro, Sir Hector
Speed, Keith


Montgomery, Fergus
Spence, John


Moore, John
Squire, Robin


Morris, M. (N'hampton, S)
Steen, Anthony


Morrison, Hon P. (Chester)
Stevens, Lewis (Nuneaton)


Moynihan, Hon C.
Stewart, Allan (Eastwood)


Mudd, David
Stewart, Andrew (Sherwood)


Murphy, Christopher
Stokes, John


Neale, Gerrard
Thomas, Rt Hon Peter


Needham, Richard
Thompson, Donald (Calder V)


Nelson, Anthony
Thompson, Patrick (N'ich N)


Neubert, Michael
Thornton, Malcolm


Newton, Tony
Townend, John (Bridlington)


Nicholls, Patrick
Tracey, Richard


Norris, Steven
Trippier, David


Onslow, Cranley
van Straubenzee, Sir W.


Oppenheim, Philip
Wakeham, Rt Hon John


Oppenheim, Rt Hon Mrs S.
Walden, George


Osborn, Sir John
Walker, Bill (T'side N)


Ottaway, Richard
Walker, Rt Hon P. (W'cester)


Page, John (Harrow W)
Ward, John


Page, Richard (Herts SW)
Warren, Kenneth


Parris, Matthew
Watson, John


Patten, John (Oxford)
Wells, John (Maidstone)


Pattie, Geoffrey
Wheeler, John


Pawsey, James
Wiggin, Jerry


Peacock, Mrs Elizabeth
Winterton, Nicholas


Percival, Rt Hon Sir Ian
Wood, Timothy


Pink, R. Bonner
Younger, Rt Hon George


Pollock, Alexander



Porter, Barry
Tellers for the Noes:


Powell, William (Corby)
Mr. David Hunt and


Powley, John
Mr. Timothy Sainsbury.

Question accordingly negatived.

Question, That the proposed words be there added, put forthwith pursuant to Standing Order No.33 (Questions on amendments):

The House divided: Ayes 290, Noes 194.

Division No. 136]
[10.12 pm


AYES


Adley, Robert
Atkinson, David (B'm'th E)


Aitken, Jonathan
Baker, Kenneth (Mole Valley)


Alexander, Richard
Baker, Nicholas (N Dorset)


Amery, Rt Hon Julian
Baldry, Anthony


Amess, David
Banks, Robert (Harrogate)


Ancram, Michael
Batiste, Spencer


Arnold, Tom
Beaumont-Dark, Anthony


Ashby, David
Bellingham, Henry


Aspinwall, Jack
Bendall, Vivian


Atkins, Rt Hon Sir H.
Benyon, William


Atkins, Robert (South Ribble)
Berry, Sir Anthony






Bevan, David Gilroy
Gregory, Conal


Biffen, Rt Hon John
Griffiths, E. (B'y St Edm'ds)


Biggs-Davison, Sir John
Griffiths, Peter (Portsm'th N)


Blaker, Rt Hon Sir Peter
Grist, Ian


Body, Richard
Ground, Patrick


Boscawen, Hon Robert
Grylls, Michael


Bottomley, Peter
Gummer, John Selwyn


Bowden, A. (Brighton K'to'n)
Hamilton, Hon A. (Epsom)


Bowden, Gerald (Dulwich)
Hamilton, Neil (Tatton)


Boyson, Dr Rhodes
Hampson, Dr Keith


Braine, Sir Bernard
Hanley, Jeremy


Brandon-Bravo, Martin
Hannam, John


Bright, Graham
Hargreaves, Kenneth


Brinton, Tim
Harris, David


Brittan, Rt Hon Leon
Harvey, Robert


Brooke, Hon Peter
Haselhurst, Alan


Bruinvels, Peter
Havers, Rt Hon Sir Michael


Bryan, Sir Paul
Hawkins, C. (High Peak)


Buchanan-Smith, Rt Hon A.
Hawksley, Warren


Buck, Sir Antony
Hayes, J.


Bulmer, Esmond
Hayhoe, Barney


Burt, Alistair
Hayward, Robert


Butcher, John
Heathcoat-Amory, David


Butterfill, John
Henderson, Barry


Carlisle, John (N Luton)
Heseltine, Rt Hon Michael


Carlisle, Kenneth (Lincoln)
Hickmet, Richard


Carttiss, Michael
Hicks, Robert


Chalker, Mrs Lynda
Higgins, Rt Hon Terence L.


Channon, Rt Hon Paul
Hill, James


Chapman, Sydney
Hind, Kenneth


Churchill, W. S.
Hirst, Michael


Clark, Hon A. (Plym'th S'n)
Hogg, Hon Douglas (Gr'th'm)


Clark, Dr Michael (Rochford)
Holland, Sir Philip (Gedling)


Clark, Sir W. (Croydon S)
Holt, Richard


Clarke, Kenneth (Rushcliffe)
Hooson, Tom


Clegg, Sir Walter
Hordern, Peter


Cockeram, Eric
Howarth, Alan (Stratf'd-on-A)


Colvin, Michael
Howarth, Gerald (Cannock)


Coombs, Simon
Howe, Rt Hon Sir Geoffrey


Cope, John
Howell, Rt Hon D. (G'ldford)


Corrie, John
Howell, Ralph (N Norfolk)


Couchman, James
Hubbard-Miles, Peter


Cranborne, Viscount
Hunt, David (Wirral)


Critchley, Julian
Hunt, John (Ravensbourne)


Crouch, David
Hurd, Rt Hon Douglas


Currie, Mrs Edwina
Irving, Charles


Dorrell, Stephen
Jackson, Robert


Douglas-Hamilton, Lord J.
Jenkin, Rt Hon Patrick


Dover, Denshore
Jessel, Toby


Dunn, Robert
Jones, Gwilym (Cardiff N)


Edwards, Rt Hon N. (P'broke)
Jones, Robert (W Herts)


Eggar, Tim
Joseph, Rt Hon Sir Keith


Emery, Sir Peter
Key, Robert


Evennett, David
King, Rt Hon Tom


Eyre, Sir Reginald
Knight, Gregory (Derby N)


Fallon, Michael
Knowles, Michael


Farr, John
Knox, David


Favell, Anthony
Lamont, Norman


Fenner, Mrs Peggy
Lang, Ian


Finsberg, Sir Geoffrey
Latham, Michael


Fletcher, Alexander
Lawler, Geoffrey


Forman, Nigel
Lawson, Rt Hon Nigel


Forsyth, Michael (Stirling)
Leigh, Edward (Gainsbor'gh)


Forth, Eric
Lennox-Boyd, Hon Mark


Fowler, Rt Hon Norman
Lester, Jim


Fox, Marcus
Lewis, Sir Kenneth (Stamf'd)


Fraser, Peter (Angus East)
Lightbown, David


Freeman, Roger
Lilley, Peter


Fry, Peter
Lloyd, Ian (Havant)


Gale, Roger
Lloyd, Peter, (Fareham)


Galley, Roy
Lord, Michael


Gardiner, George (Reigate)
Lyell, Nicholas


Gardner, Sir Edward (Fylde)
McCrindle, Robert


Gilmour, Rt Hon Sir Ian
Macfarlane, Neil


Glyn, Dr Alan
MacGregor, John


Goodlad, Alastair
MacKay, Andrew (Berkshire)


Gow, Ian
MacKay, John (Argyll &amp; Bute)


Gower, Sir Raymond
Maclean, David John.


Grant, Sir Anthony
Macmillan, Rt Hon M.


Greenway, Harry
McNair-Wilson, P. (New F'st)





McQuarrie, Albert
Raffan, Keith


Madel, David
Raison, Rt Hon Timothy


Major, John
Rathbone, Tim


Malins, Humfrey
Rees, Rt Hon Peter (Dover)


Malone, Gerald
Renton, Tim


Maples, John
Rhodes James, Robert


Marland, Paul
Rhys Williams, Sir Brandon


Marlow, Antony
Ridley, Rt Hon Nicholas


Marshall, Michael (Arundel)
Ridsdale, Sir Julian


Mates, Michael
Rifkind, Malcolm


Mather, Carol
Roberts, Wyn (Conwy)


Maude, Francis
Roe, Mrs Marion


Mawhinney, Dr Brian
Rost, Peter


Maxwell-Hyslop, Robin
Rowe, Andrew


Mayhew, Sir Patrick
Rumbold, Mrs Angela


Merchant, Piers
Ryder, Richard


Meyer, Sir Anthony
Sackville, Hon Thomas


Miller, Hal (B'grove)
Sainsbury, Hon Timothy


Mills, lain (Meriden)
Shaw, Giles (Pudsey)


Mills, Sir Peter (West Devon)
Shaw, Sir Michael (Scarb')


Miscampbell, Norman
Silvester, Fred


Mitchell, David (NW Hants)
Sims, Roger


Moate, Roger
Skeet, T. H. H.


Monro, Sir Hector
Smith, Sir Dudley (Warwick)


Montgomery, Fergus
Speed, Keith


Moore, John
Spence, John


Morris, M. (N'hampton, S)
Squire, Robin


Morrison, Hon P. (Chester)
Steen, Anthony


Moynihan, Hon C.
Stevens, Lewis (Nuneaton)


Mudd, David
Stewart, Allan (Eastwood)


Murphy, Christopher
Stewart, Andrew (Sherwood)


Neale, Gerrard
Stokes, John


Needham, Richard
Thomas, Rt Hon Peter


Nelson, Anthony
Thompson, Donald (Calder V)


Newton, Tony
Thompson, Patrick (N'ich N)


Nicholls, Patrick
Thornton, Malcolm


Norris, Steven
Townend, John (Bridlington)


Onslow, Cranley
Tracey, Richard


Oppenheim, Philip
Trippier, David


Oppenheim, Rt Hon Mrs S.
van Straubenzee, Sir W.


Osborn, Sir John
Wakeham, Rt Hon John


Ottaway, Richard
Walden, George


Page, John (Harrow W)
Walker, Bill (T'side N)


Page, Richard (Herts SW)
Walker, Rt Hon P. (W'cester)


Parris, Matthew
Ward, John


Patten, John (Oxford)
Warren, Kenneth


Pawsey, James
Wells, John (Maidstone)


Peacock, Mrs Elizabeth
Wheeler, John


Percival, Rt Hon Sir Ian
Wiggin, Jerry


Pink, R. Bonner
Winterton, Nicholas


Pollock, Alexander
Wood, Timothy


Porter, Barry
Younger, Rt Hon George


Powell, William (Corby)



Powley, John
Tellers for the Ayes:


Prentice, Rt Hon Reg
Mr. Tristan Garel-Jones and


Proctor, K. Harvey
Mr. Michael Neubert.




NOES


Alton, David
Brown, R. (N'c'tle-u-Tyne N)


Anderson, Donald
Brown, Ron (E'burgh, Leith)


Archer, Rt Hon Peter
Bruce, Malcolm


Ashley, Rt Hon Jack
Callaghan, Jim (Heyw'd &amp; M)


Ashton, Joe
Campbell-Savours, Dale


Atkinson, N. (Tottenham)
Canavan, Dennis


Bagier, Gordon A. T.
Carlile, Alexander (Montg'y)


Banks, Tony (Newham NW)
Carter-Jones, Lewis


Barnett, Guy
Clark, Dr David (S Shields)


Barron, Kevin
Clarke, Thomas


Beckett, Mrs Margaret
Clay, Robert


Beith, A. J.
Cocks, Rt Hon M. (Bristol S.)


Bell, Stuart
Cohen, Harry


Bennett, A. (Dent'n &amp; Red'sh)
Coleman, Donald


Bermingham, Gerald
Concannon, Rt Hon J. D.


Bidwell, Sydney
Conlan, Bernard


Blair, Anthony
Cook, Frank (Stockton North)


Boothroyd, Miss Betty
Cook, Robin F. (Livingston)


Boyes, Roland
Corbett, Robin


Brown, Gordon (D'f'mline E)
Corbyn, Jeremy


Brown, Hugh D. (Provan)
Cowans, Harry


Brown, N. (N'c'tle-u-Tyne E)
Cox, Thomas (Tooting)






Craigen, J. M.
Hogg, N. (C'nauld &amp; Kilsyth)


Crowther, Stan
Holland, Stuart (Vauxhall)


Cunliffe, Lawrence
Home Robertson, John


Cunningham, Dr John
Howell, Rt Hon D. (S'heath)


Davies, Ronald (Caerphilly)
Howells, Geraint


Davis, Terry (B'ham, H'ge H'l)
Hoyle, Douglas


Deakins, Eric
Hughes, Mark (Durham)


Dobson, Frank
Hughes, Robert (Aberdeen N)


Dormand, Jack
Hughes, Roy (Newport East)


Douglas, Dick
Hughes, Sean (Knowsley S)


Dubs, Alfred
Janner, Hon Greville


Dunwoody, Hon Mrs G.
John, Brynmor


Eadie, Alex
Jones, Barry (Alyn &amp; Deeside)


Eastham, Ken
Kaufman, Rt Hon Gerald


Edwards, Bob (W'h'mpt'n SE)
Kennedy, Charles


Ellis, Raymond
Kinnock, Rt Hon Neil


Evans, loan (Cynon Valley)
Kirkwood, Archibald


Evans, John (St. Helens N)
Lambie, David


Ewing, Harry
Leadbitter, Ted


Fatchett, Derek
Leighton, Ronald


Faulds, Andrew
Lewis, Ron (Carlisle)


Field, Frank (Birkenhead)
Lewis, Terence (Worsley)


Fields, T. (L'pool Broad Gn)
Litherland, Robert


Fisher, Mark
Lloyd, Tony (Stretford)


Flannery, Martin
Lofthouse, Geoffrey


Foot, Rt Hon Michael
Loyden, Edward


Forrester, John
McCartney, Hugh


Foster, Derek
McDonald, Dr Oonagh


Foulkes, George
McGuire, Michael


Fraser, J. (Norwood)
McKay, Allen (Penistone)


Freeson, Rt Hon Reginald
McKelvey, William


Freud, Clement
Mackenzie, Rt Hon Gregor


George, Bruce
McNamara, Kevin


Gilbert, Rt Hon Dr John
McTaggart, Robert


Godman, Dr Norman
Madden, Max


Golding, John
Marek, Dr John


Gould, Bryan
Marshall, David (Shettleston)


Gourlay, Harry
Martin, Michael


Hamilton, James (M'well N)
Mason, Rt Hon Roy


Hardy, Peter
Maxton, John


Harman, Ms Harriet
Maynard, Miss Joan


Hart, Rt Hon Dame Judith
Meadowcroft, Michael


Haynes, Frank
Michie, William


Healey, Rt Hon Denis
Mikardo, Ian


Heffer, Eric S.
Millan, Rt Hon Bruce





Miller, Dr M. S. (E Kilbride)
Short, Mrs H.(W'hampt'n NE)


Morris, Rt Hon A. (W'shawe)
Silkin, Rt Hon J.


Morris, Rt Hon J. (Aberavon)
Skinner, Dennis


Nellist, David
Smith, C.(Isl'ton S &amp; F'bury)


Oakes, Rt Hon Gordon
Smith, Rt Hon J. (M'kl'ds E)


O'Brien, William
Snape, Peter


O'Neill, Martin
Soley, Clive


Park, George
Spearing, Nigel


Parry, Robert
Stott, Roger


Patchett, Terry
Strang, Gavin


Pendry, Tom
Straw, Jack


Penhaligon, David
Thomas, Dafydd (Merioneth)


Pike, Peter
Thomas, Dr R. (Carmarthen)


Powell, Raymond (Ogmore)
Thompson, J. (Wansbeck)


Prescott, John
Thorne, Stan (Preston)


Radice, Giles
Tinn, James


Randall, Stuart
Torney, Tom


Redmond, M.
Wallace, James


Rees, Rt Hon M. (Leeds S)
Wardell, Gareth (Gower)


Richardson, Ms Jo
Wareing, Robert


Roberts, Allan (Bootle)
Weetch, Ken


Roberts, Ernest (Hackney N)
Welsh, Michael


Robertson, George
White, James


Rooker, J. W.
Williams, Rt Hon A.


Ross, Stephen (Isle of Wight)
Winnick, David


Rowlands, Ted
Woodall, Alec


Ryman, John
Wrigglesworth, Ian


Sedgemore, Brian
Young, David (Bolton SE)


Sheerman, Barry



Sheldon, Rt Hon R.
Tellers for the Noes:


Shore, Rt Hon Peter
Mr. Don Dixon and


Short, Ms Clare (Ladywood)
Mr. John McWilliam.

Question accordingly agreed to.

MR. SPEAKER forthwith declared the main Question, as amended, to be agreed to.

Resolved,
That this House, while deeply sympathising with the people affected by necessary industrial change, wishes to see an efficient railway engineering industry in the United Kingdom that can supply British and the rest of the domestic market competitively and win orders from overseas; and strongly supports the British Railways Board's efforts to achieve this.

Education (Assisted Places)

The Under-Secretary of State for Education and Science (Mr. Robert Dunn): I beg to move,
That the draft Education (Assisted Places) (Amendment) Regulations 1984, which were laid before this House on 16th January, be approved.
I think it fair to say now that the assisted places scheme has come of age. Some four years ago, when the Act which set it up — the Education Act 1980 — was under consideration in this House, it attracted a deal of opposition. The scheme was untried and untested. Some critics argued, no doubt in good faith, that it would be nothing more than a subsidy to the rich. Others of a more negative turn of mind simply squirmed at the idea of so significant an extension of parental choice of school.
Events since then have roundly vindicated our faith in the scheme. The figures prove that it is no subsidy to the rich. On the contrary, the great majority benefiting come from below average income households. I do not know if many of the remaining critics of the scheme have troubled, as I have done, actually to meet some of the children involved and their parents. It is quite clear from talking to them that the scheme has opened up for them what would otherwise have been undreamed-of opportunities. Their enthusiastic endorsement of the scheme is as good evidence as any that it is working, and working well.
There are now more than 13.000 children on assisted places at more than 200 of the best independent schools in the country. That represents not far short of 15 per cent. of the total intake to independent schools of the relevant age groups. It represents more like a third of the total intake at the schools actually in the scheme. The House must remember that these are among the very best of the independent schools in the country. Many of them are famous names. All of them meet the extremely exacting academic standards we require for participation.
I ask the House to ponder these figures. A full 40 per cent. of the children now in the scheme come from families whose gross combined income is less than £6,000. Nearly three quarters come from families with incomes below the national household average. The scale for determining the amount of fee remission is intentionally a stiff one, and only those with incomes below about £5,600 a year qualify in the current year for entirely free places. Anyone whose family's gross combined income is above about £14,000 will get little, if any, assistance. With that evidence, I should be ready to take on anyone who would still describe the assisted places scheme as a subsidy to the rich.
Neither is it a means of sustaining those, albeit of lower income, who would somehow have had their children at independent schools anyway. The regulations governing the scheme enjoin schools to ensure that at any time at least 60 per cent. of their aided pupils attended maintained schools immediately before moving to the independent school. A small number of schools have, for one reason or another, found that difficult to achieve, and in those cases we have reduced their intake quotas to a level at which they can meet the objectives of the scheme. The great majority of schools, however, have no difficulty at

all in finding the entrants they want from the maintained sector, and we have indeed been able to give increased quotas to some of the most successful recruiters.
An area of difficulty when the scheme first got off the ground was sixth-form recruitment. There are about 1,000 assisted places available annually to sixth-form entrants. As hon. Members will recall, under the original regulations a pupil could not transfer to an assisted sixth-form place from a maintained school unless he had the consent of the local education authority in which he lived. This provision was incorporated in answer to the fears expressed by the local authority associations that substantial poaching from maintained schools at this stage could, in some instances, jeopardise maintained sixth-form provision. A further safeguard was, however, provided by our refusal in practice to give any school a quota of more than five assisted places per sixth-form intake. This, the House will be pleased to know, on its own proved, in fact, to be all that was necessary. Last year, therefore, the House approved amending regulations that removed the local education authorities' formal power of veto.
Although not many LEAs had in fact used the veto, the few that did gave sixth-form transfers something of a bad name. As a consequence, sixth-form recruitment in the first two years of the scheme was relatively low. By last September, however, with the veto removed, sixth-form recruitment was well up, and closing in on recruitment at 11 to 13. I am delighted to see that, left to itself, the assisted places scheme can be shown to offer as much to sixth formers as to younger pupils.
Let me reassure the House also that this has not taken place to any significant disadvantage of maintained sixth forms. Returns from assisted places schools show that very few of them recruited more than one pupil from any given maintained school. I am quite satisfied, therefore, that the impact on maintained sixth forms is negligible.
All the factors I have been describing — the consistently low income profiles of the families benefiting, the successful recruitment of pupils who had probably never seen the inside of an independent school before, the redistribution of quotas away from poor recruiters to successful ones, the rapid improvement in arrangements at sixth-form level—underline what I was saying at the beginning, that the assisted places scheme has come of age. It is familiar to people from all walks of life. Indeed, it is very popular with the majority of the population and with hon. Members on both sides of the House. It reflects no small credit on those who set it up that it is already working so smoothly.

Mr. Clement Freud: Name one.

Mr. Dunn: I meant to say "on this side of the House." Being a man of great generosity, I am delighted always to accede to the wishes of Members on the Opposition Benches.
This has been a fitting stage, therefore, at which to review, in the light of experience, the detailed procedures laid down in the regulations for running the scheme. Very little, in fact, has appeared to want changing. The amended regulations before us are designed mainly to iron out some minor wrinkles in the original arrangements, though, as in the past, provision is also made for the revaluation of the parental income scale.
I shall describe each of the amendments in turn and, if there are detailed queries that hon. Members wish to raise during the course of the debate, I shall be happy to attempt to answer them at the end.
Regulations 1 and 2 are entirely technical and I shall not trouble the House with comment on them. Regulation 3 is intended to make the administration of the scheme less burdensome for schools. As the House knows, the Secretary of State has a reserve power to disallow fee increases at any of the schools in the scheme if he considers what is proposed to be unreasonable. To this end, the present regulations require schools to give two months' notice of any intended fee increases, and the Secretary of State then has a month in which he must give directions to a school if he has doubts about the proposal. Given the timetabling of governors' meetings and other matters, the requirements of this timetable is often very hard for schools to meet.

Mr. Andrew F. Bennett: Will the Minister permit me to intervene?

Mr. Dunn: No.
In the light of experience, in the very occasional use of this power we see no problems in shortening this timetable. Regulations 3 therefore reduces the period of notice to one month and the period in which the Secretary of State must issue any directions is reduced from a month to a week.
Regulation 4 is put forward in response to a number of hard cases that have been brought to our attention. For the current assessment of fee remission, the income of both parents is taken into account, unless the parents are divorced or separated, or one of them cannot be traced, or something of the sort. Under the existing regulations, it is not enough for this purpose for parents to be separated by simple deed; there must be a formal court order. This contrasts with Inland Revenue practice where separation under a deed is sufficient for income tax purposes. Regulations 4 will therefore bring us more closely into line with Inland Revenue practice and extend relief to a number of children from broken homes who hitherto could not benefit for the simple absence of a formal court order.

Mr. Bennett: rose—

Mr. Dunn: Turning to Regulation 5, under the existing regulations the circumstances are closely prescribed in which a child may take up an assisted place at other than at one of the school's normal ages of entry; 11, 12 or 13 and 16-plus. This has prevented from benefiting a number of children who to all intents and purposes would be regarded as very deserving cases. Regulation 5 relaxes this and will allow a child to take up a place at any age over 11 provided that he will be in a class with other assisted pupils. The hon. Member for Denton and Reddish (Mr. Bennett) may now intervene.

Mr. Bennett: On how many occasions under the regulations has the Secretary of State used his power to refuse the increase sought?

Mr. Dunn: I do not have the answer to that at hand. The hon. Gentleman asks a fair question which I will answer when I reply to the debate.
Regulation 6 provides for the updating of the income scale used for assessing the amount of parents'

contributions towards the fees in line with increases in earnings. The threshold below which parents pay nothing towards fees is raised to £6,046 gross. Families with average incomes will be liable to pay just under £500 towards fees in 1984–85, but the three quarters or so coming forward who have lower incomes than the average will pay less, and often much less.
Regulation 7 is proposed purely for purposes of clarification. Many hon. Members present will recall that last year we amended the regulations to provide that a teacher barred from teaching in a maintained school would be automatically barred from teaching in an APS school. Regulation 7 simply makes clear, for the avoidance of any possible doubt, that this applies only to those who have been barred on grounds of misconduct. It does not apply to any teachers who are disqualified for any other reason.
Finally, regulation 8 makes three changes of a more or less technical nature to the rules for assessing income. Regulation 8(1) simply updates the reference to relevant income tax legislation in the principal regulations. Regulation 8(2) deletes one provision and substitutes a rather different one it its place, both in the interests of greater equity. Under the existing regulations, redundancy payments must normally be counted towards the assessment of income. The deletion proposed would bring the regulations into line with current Inland Revenue practice, under which the first £25,000 of any redundancy payments is excluded from the computation of income. The replacement provision proposed in regulation 8(2) provides for adoption allowances, which previously had to be counted towards gross income, also to be excluded from the calculation of income.
I am confident that the changes that I have described tonight will have the backing of the schools in the scheme and — more important — that of the parents and the children themselves. The new regulations will make for smoother and fairer administration under the handful of headings where there was a need for improvement. They will only enhance what is already now a thoroughly succesful scheme.

Mr. Andrew F. Bennett: The Minister claimed that the scheme is popular. None of my constituents has come to comment on the scheme. I suspect that the vast majority of people are not aware of it and do not accord it any popularity. Perhaps the Minister could tell us how many of his constituents have benefited from the scheme and how many have come to him to praise it. I suspect that there are very few.

Mr. Dunn: I am pleased to be able to give an answer to the earlier point that the hon. Gentleman raised. A number of queries have been raised on the same point, and the answer is that my right hon. Friend the Secretary of State has forbidden one fee increase.

Mr. Bennett: I thank the Minister for that information, and perhaps in due course he can find out whether any of his constituents have benefited from the scheme.
I do not want to complain that the Secretary of State is not here. I am sure that that is not through any lack of interest in the scheme. It is perhaps that he wants symbolically to distance himself from it.

Mr. Dunn: Rubbish.

Mr. Bennett: It was noticeable that the Secretary of State received a good notice at Sheffield, not for what he said, but because he managed to omit references to the assisted places scheme, student loans, vouchers, selective schools and all the other mumbo-jumbo that we have heard so often from the Conservative Benches. He went back to the safe topic of education standards, which have, on the whole, united educationists since we first debated the subject in the House in 1868, when people were arguing for state education for all children. It is interesting that it was the Secretary of State's efforts to talk about rising standards that got him the enthusiasm of the educationists rather than his earlier ideas about assisted places and vouchers.
On Friday the Secretary of State went even further in the education debate in the House. He ventured the view that if educationists and the Opposition could show that to raise standards he has to raise a little more money, he might go back to the Cabinet and ask for extra resources to improve education standards. I thought that we were making some progress, but it appears that we have slipped back tonight and that the Conservative party has not changed its attitudes. It wants to confer privilege on a small number of students and privilege and status on a small group of institutions, and it does not care about the basic state system and the vast majority of children. It always wants to go for a selective group.
The Minister claimed that the selected group were people on relatively low incomes. Our complaint does not concern whether they are on low or high incomes; it is that the Conservative party is concerned with conferring privilege on a particular group of people, rather than with giving all children a decent education.
That is what is wrong with these regulations, and with the enthusiasm of Conservative Members. They believe in giving privilege to a few people. Why do they not believe in giving a decent education to everybody and removing the necessity for schemes of this nature?

Mr. J. F. Pawsey: It is called choice.

Mr. Bennett: The hon. Gentleman talks about choice. Let us give everyone the choice of having a better education. Conservative Members say, "Let us select a small group and give those people privilege — not everybody." So it is not a question of choice. Not every person can apply for the scheme. A test is involved, and the scheme is there only for a privileged group. It does not matter how one chooses the privileged group. Only some people are allowed to benefit from the scheme, such as it is.
I want to ask the Minister one or two questions. In an intervention I asked him about the number of times on which he had objected to schools putting up their fees. Can he tell us what the average increase in fees has been in these selected schools, and how that compares with the average increase in resources available for state schools during the period? Logically, one would think that an increase in fees should be no more than the increase in resources or the cut in resources in many of our state schools. Can the Minister tell us how many were refused? He said in his intervention that there had been one. I am pleased to hear that there has been one, but I wonder how big an increase that school applied for? When he gets information from schools, is there an analysis of what the

increase is for — staff, or books, or whatever? Again, how does that compare with the salary scales that can be paid in the state schools, and how far does it compare with the amount that is available for books?
There is great resentment in many state schools because the Secretary of State and others continually complain that they do not achieve standards, although they have To stick to the Burnham rates of pay. Many of the schools in this scheme can pay over the odds to attract teachers who, in effect, work longer hours. I wonder how far the Minister has looked at the fees claimed to see whether—

Mr. Dunn: The hon. Gentleman talks about schools in the independent sector paying over the odds. Would he care to give evidence of schools that have done that?

Mr. Bennett: I could give the Minister examples of independent schools, but I shall not quote them off the cuff. However, I shall write to him giving individual instances of schools which I understand pay over the odds.
However, I was asking the Minister to give the House some information. I asked him to give us instances where he has checked the fees in independent schools to see whether what I say about them paying over the odds is true. I shall send him one or two instances where I claim that rates of pay have been over the Burnham rates.

Mr. Harry Greenway: Will the hon. Gentleman accept from me that very little research is needed to establish that some pupils on assisted places require less to be paid in fees to the institution concerned than children at maintained schools?

Mr. Bennett: The hon. Gentleman suggests that one reason is that many of these schools have school hours and terms which are very different from those in the state system. They have never stuck to the Burnham rates. They claim that they make extra payments for all sorts of reasons. I claim that, in assessing the fees, it is important for the Minister to take into account the salaries that have been paid in the schools, and why. That is another example of the way in which the scheme confers privilege on a small group rather than offers benefit to the whole of the state system.

Mr. Greenway: What I am saying is that it costs less per pupil in some schools under the assisted places scheme than it does in some maintained schools.

Mr. Bennett: Has the hon. Gentleman taken into account all the figures? One must consider the problem for the local authority, which still has a duty to provide the school buildings and so on. The staff for a place at each school have to be covered, in addition to the Government paying the money for the assisted place, so there is a double cost to take into account. [HON. MEMBERS: "Rubbish."] It is not rubbish. Hon. Members have not considered the facts. Once a school has been built, capital charges have to be paid whether or not the school is used. The local authority could not get rid of the capital charges even if it wanted to. Heating, caretaking and other things have to be provided whether there are 30 children or 31. If one child is taken out of the school and given an assisted place, the local authority does not get rid of the cost. It still has the cost of providing that place.
Can the Minister tell us whether the increases in the means-test scales are in line with inflation? When he talked about the way in which the scheme was being brought into line with income tax, he also claimed that it


was supposed to benefit the least well off. May I explain to him that the least well off in our society are involved not with income tax but with supplementary benefit. Instead of taking the disregards limits for supplementary benefit, which is about £3,000, he is putting in a figure of £25,000. That involves a different set of figures. If the Minister is so concerned about the scheme helping the very poor, I am puzzled about why he links it to income tax, which tends to be for people on higher incomes, rather than to the supplementary benefit scheme, which is for those on the lowest incomes.

Mr. Dunn: We are trying to line up the practice within the scheme with Inland Revenue practice. We have brought the two together. In another context the hon. Gentleman would no doubt complain bitterly if we left them as they are.

Mr. Bennett: The point is simple. The Minister claimed that the whole scheme was to be for the least well off. If he wants to link it to the least well off, he should remember that they have to deal with the disregards for supplementary benefit rather than for income tax. I should have thought that it would be a good idea to increase the disregards limit for supplementary benefit, but of course that would cost money, and the Government are too keen to spend it on things like this scheme instead of helping people who are on really low incomes.

Mr. Dunn: rose—

Mr. Bennett: No. The Minister was reluctant to give way when I wanted to intervene during his speech. I think that I ought to make more progress.
The Minister claimed that the scheme helps families where the parents have split up. I accept that, although I wonder whether he has not built into the scheme a disincentive for those who have separated to come together again. In the regulations there is a considerable financial disincentive for people to patch up disagreements.
How much extra will the regulations cost the Exchequer, and what will be the total expenditure? What will be the effect on state schools? If three children each year end up going to a school that is involved in the assisted places scheme and they are within the catchment area of a substantial comprehensive school, we are talking about 20 to 22 pupils over six or seven years. That means that the school will lose its entitlement to a teacher, and in many instances a school in that position will see its curriculum reduced as a result of the loss of a teacher. I hope that the Minister will confirm that by implementing the assisted places scheme he is denying schools some of their most able pupils, some teachers and the resources which they might otherwise have. That means that their curriculum will become restricted. The Minister is compounding the problem of falling rolls by taking away teachers and reducing the width of the curriculum.
The money that we are talking about is money that is desperately needed for most state schools for their buildings. It is money that is needed also to improve reading schemes. The Secretary of State talks about the need to improve education standards. I have visited many schools recently—I do not know how often the Minister visits schools — which would very much like to introduce new reading schemes in the primary sector. We

find that the £500 or £600 that is required for a new reading scheme is almost impossible to find within the allowance that is made for equipment. It is amazing that the Government can find money for the assisted places scheme but not to ensure that buildings in the maintained sector are adequate. They cannot find money for new reading schemes in primary schools and they have cut the provision of remedial teachers in primary schools. —[HON. MEMBERS: "Rubbish."]
The Minister talked about removing the veto on recruitment into sixth forms.

Mr. Nigel Spearing: Did my hon. Friend hear Conservative Members say that it is rubbish to say that remedial teachers have been removed from primary schools? Is he aware that that has happened in my consitituency in Silvertown, in London's dockland, and that it is not rubbish?

Mr. Bennett: I am aware that remedial teachers have disappeard from many primary schools, and that is one of the results of the assisted places scheme and the Government's allocation of money. If the Government had managed to put sufficient money into education to avoid the loss of remedial teachers, for example, it might have been possible to talk about assisted places. But if the Government have only a limited amount of money and they place priority on assisted places and not on remedial teachers, they cannot expect the Opposition to support their policy. The argument is not confined to remedial teachers, for it embraces all the extra provision that is needed within the state system.
The Minister said that the Government have taken away the veto which stopped recruitment into sixth forms. Is he not worried that there will be creaming off by the sixth forms? The Minister claims that the problem did not arise and that the Government think it right to remove the veto. I understand that one or two local authorities have put forward proposals for reorganising their comprehensive schools with a view to establishing sixth-form colleges. Schools which have been operating assisted places schemes in those authorities have lobbied hard against sixth-form colleges because they fear that if a state sixth-form college is established in the locality it will attract pupils away from the direct grant schools or the independent schools. I suspect that a veto has been exercised by one or two of the schools, which have said to the Secretary of State, "If you introduce sixth-form colleges in our area, or allow the local authority to do so, you will damage us as an independent school." I suspect that there is considerable evidence that that has happened.
How many people have been opting out of the scheme? When we pressed this question in Committee, the Government did not give much information about how much assistance—

Mr. Barry Porter: Will the hon. Gentleman give way?

Mr. Bennett: Not at the moment—they were given to help people. The Government helped with fees, but the trouble with many state and independent schools is that they require parents to pay for a large number of extras. For people on low incomes the extras demanded by schools cause many problems. Will the Minister assure us that those who have been encouraged and inveigled by the


Government into participating in these schemes have not run into financial difficulty because of the extras demanded by schools?
The Government are about to announce their technical and vocational education initiative. Are any of the independent schools involved? When the Government were putting forward their scheme for technical and vocational education, they claimed that it was to go across the whole sector of education, but presumably they do not intend that to happen in independent schools.
I suggest to the Under-Secretary that he address himself to a serious problem. Before standards in education can be raised, he must lift the morale of all teachers. Unfortunately, this scheme does not do that, but makes most teachers feel that they are being unfairly treated and discriminated against. We want a clear commitment from the Under-Secretary that he is determined to lift the morale of all teachers and to ensure that there are adequate resources so that all teachers can do a good job for all our children. He should not concentrate all his efforts on this scheme, which is designed to offer a little privilege to a small group of children and to distract the country from the problem of raising standards for all our children. I hope that my hon. Friends will oppose the motion.

Mr. David Evennett: It is always interesting to be involved in a debate on education, because everyone seems to know something about it. In one way or another, we have all experienced it and been through the system. We all have memories of our school days—good and bad—and both sides of the House have their philosophical convictions about education.
Education is vital in the modern world which is subject to constant change. For society, a well-educated and adaptable work force is one of the keys to a sound and prosperous economy. An end to stereotypes — I am afraid that this evening we have heard some—must be the aim in obtaining the best possible education for all our children in the national interest.
A good education is paramount for the individual pupil and his or her parents, and there is undoubtedly a demand for the child to be able to develop his or her individual talents to the full, to enjoy a good basic education and to study a wide curriculum. Only through those factors can the child be equipped to maximise his or her opportunities in the wider world when school is left. The education provided must be relevant to the child's abilities and to the needs of the individual within the modern world. It should encourage also the development of the child's creative and imaginative talents.
I am sure that, in all sincerity, all hon. Members are looking for the best education for all children.

Mr. Martin Flannery: Nonsense.

Mr. Evennett: Conservative Members certainly are.
The amendment does not radically alter any educational provision or any of the Government's objectives. It is merely a legal tidying-up operation with an inclusion to amend the financial limits in line with inflation, as required by the original legislation.
I understand that the Government remain totally committed to the principle of the assisted places scheme and I am sure that all Conservative Members agree that

that is right. It is not only right for the children concerned, but it is in line with the Government's philosophy of a good basic education for all our children with an attempt to develop academic excellence in those with special ability. The aim remains that of advancement on the basis of merit.
As my hon. Friend the Minister said, there is no overall expansion of the scheme. The criteria for obtaining assisted places — low family income and the ability to cope with a highly academic curriculum — remain unchanged. Labour Members oppose not only the technical change being made but the principle behind the scheme. Some 13,000 children of considerable academic talent and potential are already benefiting from the scheme, children who will no doubt go on to make a valuable contribution to the life of the nation but whose parents' financial circumstances would not otherwise have allowed them to obtain that kind of education.
My hon. Friend the Minister dealt conclusively with the subject of the increased cost to the nation. The increase in cost will be negligible, if indeed there is any increase because the child would otherwise be in a state school. If the parents could afford to pay for a place at an independent school the child would not qualify under the scheme. As we have heard, 40 per cent. of the children benefiting from the scheme come from families with incomes below £6,000 per year.
The Opposition constantly — and rightly — urge the Government to do more for families with low incomes and talented children. Those are the very people who qualify under the scheme, but the Opposition are still complaining. The Government wish not only to help those people but to ensure that the qualification levels are updated in line with inflation.
This debate is especially relevant on a day on which many London schools have been subject to disruption due to politically motivated action by those who wish to flout the will of the people of this country — [Interruption.] The Opposition do not like the truth even when the facts are staring them in the face. Today many children's education has been halted for a day.
Our aim is an improvement in the opportunities for all children. We wish to increase education provision so that an ever-increasing number of children are offered the very best. We do not wish to reduce that opportunity or to downgrade the talent of our young people. The issue before us today is not the principle of the assisted places scheme but a technical change in it. To object to the main policy is regrettable but to object to the amendment before us is just downright mean.

Mr. Clement Freud: I have nothing against the Education (Assisted Places) (Amendment) Regulations 1984. I join the Minister n not objecting to regulations 1 and 2 in part I. The Minister did not unerstand them, and I do not understand them. They are procedural. Regulation 3 seems to be all right to me, although if, on reflection, the Minister decided to cut two months to one month and one month to one week, one wonders why he did not reflect when he introduced the regulations.
I am not troubled by regulation 4, which refers to people who are divorced or separated — that sort of thing. It seems to be all right. I have no objection to regulation 5. Regulation 6 is a simple financial regulation.


Regulation 7 is familiar, although astonishing. If a teacher commits a misdemeanour he is disqualified, but if he is simply incompetent, deaf or illiterate, he may go on working. I have no objection to regulation 8. I welcome the fact that those who adopt children will now benefit.
The trouble is that the Act was wrong, the regulations are wrong and the whole concept of assisted places is wrong.

Mr. Deputy Speaker (Mr. Harold Walker): Order. I hope that the hon. Gentleman will not further widen the debate. The concept embodied in the primary legislation is not at issue. We are discussing amendments to the regulations.

Mr. Freud: I am grateful to you, Mr. Deputy Speaker. I was about to contract my widening criticism.
I have no objection to the regulations. What I mind is the furtherance of a rotten scheme. I have spoken about it, and my hon. Friend the Member for Berwick-upon-Tweed (Mr. Beith), who was my party's education spokesman, has spoken about it. I will not rehearse the arguments, because they are on the record. I simply wish to say that, if the regulations are approved, they will be approved as part and parcel of a totally objectionable concept.

Mr. J. F. Pawsey: We have heard an untypically imaginative speech from the hon. Member for Denton and Reddish (Mr. Bennett). It may be that he had to use his imagination in order to dredge up any arguments against these excellent regulations. The only part of the hon. Gentleman's speech which I could applaud was his reference to the recent speech of the Secretary of State. He was right to commend that speech and in time it will be recognised as a clear beacon. I was pleased to hear the hon. Gentleman's unqualified support for what my right hon. Friend said.
I hope that my hon. Friend will forgive me if, on this occasion, I am a little critical of the regulations before the House. I find them a disappointment, because there seems to be no proposal to enlarge or increase the scope of the assisted places scheme. I am confident that thousands of parents will be equally disappointed. When first introduced, the scheme was modest and self-effacing. Sadly, it has not progressed. It has not yet grown to the full stature envisaged by the right hon. and learned Member for Warrington, South (Mr. Carlisle) when he introduced it in the Education Act 1980.
The assisted places scheme has proved popular with parents, contrary to the forecasts made by Opposition Members when they sought to reject the original Bill.
The scheme certainly extends choice, but only about 13,000 children are able to accept places. The choice is limited. That is one reason why I find the present regulations disappointing. I am anxious to see the parents' power to choose extended. We have not gone far enough. About 40,000 children apply to the 200 or so schools in the scheme, but only one third of that number are actually placed. The House will recall that only two qualifications are necessary for entry to the scheme. The first is the ability to pass the entrance examination.

Mr. Deputy Speaker: Order. I must remind the hon. Member of the point I made to the hon. Member for

Cambridgeshire North-East (Mr. Freud), that the House should be discussing the content of the document that is before us and not the general principles of the scheme.

Mr. Pawsey: Of course, I note your comment, Mr. Deputy Speaker. I was seeking to confine my remarks to answering some of the points made by the Opposition spokesman. I felt that one or two of his remarks should be challenged. I was seeking to do so with your guidance.
I wonder whether I might correct a general misapprehension. The scheme should not be confused with the old direct grant system. This scheme provides help to parents and families and not to schools. That is the fundamental difference between the assisted places scheme and the direct grant scheme.
Uninformed critics—we have perhaps heard some of them speaking from the Opposition Benches — sometimes argue that this measure is expensive. That is not the case. There is little significant difference in the cost of places at an independent school and a state school. The child must be educated at a cost. If the costs are the same, why should not parents have a choice? Why should they not be able to decide at which school their children should be educated?

Mr. Deputy Speaker: Order. I must ask the hon. Member to which regulation he is addressing his remarks. I find it difficult to relate his speech to the document that I have before me. I hope that he will stick closer to the matter before the House.

Mr. Pawsey: I was thinking of regulation 3, which refers to increases in fees. I was suggesting that although there had been an increase in fees, the cost of the state and private sectors was much the same. That was the point that I was seeking to make.
The scheme, in the words of my hon. Friend the Minister for Social Security, provides "a ladder of opportunity", a ladder of opportunity which does not disadvantage anyone. It provides stimulus and a clear measure of competition. The 200 schools participating in the scheme are all of proven worth and highly academic. That should reassure Opposition Members who in Committee expressed anxiety about the quality and standards of schools that were likely to be in the scheme. They should be reassured, as my hon. Friend the Minister said in his opening speech, that the schools are all of proven worth.
No subsidy is being given to the schools or even to the children since the cost of educating children is the same in whichever system they are educated.
One of the interesting points is that about 70 per cent. of the children attending schools in the scheme come from families with below average incomes. I am delighted that families are taking advantage of the assisted places scheme to give their children a good and different start in life.
I hope that when we next debate this measure my hon. Friend will be able to announce an extension of what has become a worthwhile scheme. Let it grow from the modest beginnings that it has so far enjoyed into something more ambitious. Let it develop and build more bridges between the private and state sectors. Let it assist more of our children to have a choice and achieve an excellent education.

Mr. Martin Flannery: I have taught some difficult classes in my time, but never one so clearly backward that resists the truth so determinedly.
When I hear that the regulations, which are referred to now and again to keep within the remit of the debate, are in the best interests of education for all, the imagination boggles. We all know that the Conservative party wants the regulations to use public money, which is scarce for the education of millions of children, in private education for a group of people who are filling the places in the private schools that would be empty if it were not for the public money that is being drained from us by such regulations. It is taxpayers' money. The regulations should be called the Education (Assisted Places) Emergency Provisions. As soon as we get back into office, which we shall, we shall scrap them and the assisted places scheme because it is anti-educational and against the interests of most of our children. The aim of the regulations is, as a result of inflation, to update the moneys that are going into the private sector. That is different from the clawback from the pensioners, which the Conservative party engaged in some time ago.
According to a parliamentary answer on 25 October 1983, 13,000 children are taking part in the scheme. When it is fully operational, it will cost £55 million. That is not chickenfeed. We had a major debate on education a few weeks ago and discussed the sum of less than £40 million. In time, the scheme will cover almost one quarter of all the children in the private sector. It is as big as that.
We maintain that the regulations are a farce as they will take money away from children. As my hon. Friend the Member for Denton and Reddish (Mr. Bennett) said, remedial teachers of reading are now being dispensed with all over the country, as a result of the regulations, for example in the school where I live. Many things of that nature are occurring in the education system, so much so that in order to fulfil the regulations head teachers are taking the place of remedial teachers to try to teach the children how to read, while there is luxury teaching in the schools that we are talking about.
Therefore, the regulations are an abuse of the state system. They are elitist. They say that children do not get a good education in the public sector. They convey the impression that in the state sector education is no good and that the thing to do is to get into the private sector—

Mr. Deputy Speaker: Order. The hon. Member has heard me remind the House several times that hon. Members must address themselves to the regulations. I hope that he will bring his speech closer to the content of the regulations.

Mr. Flannery: I have spoken in previous debates on the matter. We must refer to the cause of the regulations. If I have to cease to do that, my speech will be a waste of time. [HON. MEMBERS: "Hear, hear."] Purely because you, Mr. Deputy Speaker, are interpreting the debate so narrowly, it is a waste of time trying to address the fundamental problem that we are confronting. The cheers from Conservative Benches prove that the debate is far too narrow if that is all that we shall do.

Mr. Richard Tracey: I must declare an interest as a parliamentary adviser to the independent

schools. In that role I must say that I welcome the regulations as far as they go, but I share the view of my hon. Friend the Member for Rugby and Kenilworth (Mr. Pawsey) that it would be nice if the Government announced another extension of the assisted places scheme. We know from opinion polls that 60 per cent. of the public support the scheme. Perhaps Opposition Members should remember that.
I should like to draw attention to a funny fact about the Opposition. It was interesting to hear the social engineer-in-chief, the hon. Member for Denton and Reddish (Mr. Bennett), open the case for the Opposition. Arrayed around him we have the hon. Member for Durham, North (Mr. Radice), who is an old boy of Winchester, and the hon. Member for Cambridgeshire, North-East (Mr. Freud) who is an old boy of St. Paul's school and Dartington hall. We also have the hon. Member for Stoke-on-Trent, Central (Mr. Fisher), who is an old Etonian, no less. No doubt we shall soon hear his views of the subject. Moreover, we just heard from the hon. Member for Sheffield, Hillsborough (Mr. Flannery) who managed to become a schoolmaster and a Member of Parliament by being educated at a grammar school, as he has told us before. That list illustrates the hypocrisy of Opposition Members attacking regulations which help extremely bright children who might come from deprived homes onto the ladder by which they can achieve what Opposition Members have achieved.
I am glad that the regulations extend the threshold. The scheme goes from strength to strength. It has grown from 4,000 to 13,000 pupils. It grows by about 5,000 pupils a year. If the Opposition talked of such growth in other areas they would be cheering. However, they are complaining that 5,000 more pupils are being given a chance in life by the scheme which the regulations extend. No less than 40 per cent. of the parents of children who go into the scheme earn less than £6,000 a year. Conservative Members rightly applaud that. We also welcome Westminster school to the scheme. It is one of the finest schools in the country. Its governors and, I trust, its headmaster have decided that it is right for it to join the scheme.
I draw the attention of Opposition Members to the joy on the faces of parents and children who have profited from the scheme who recently came to London to meet my hon. Friend the Minister. More children will profit by an extension of the regulations. I know of a Birkenhead bus driver and his daughter, a Bradford teacher, who welcomed the scheme and suggested that the Government should go further, an unemployed man from Manchester who has one child on the assisted places scheme with another to follow, a teacher from London, a caretaker from Newcastle—

Mr. Andrew F. Bennett: rose—

Mr. Tracey: I shall not give way—and a man and wife from Sheffield with two children on the assisted places scheme who asked me, when I was privileged to talk to them, to pass on a challenge to the hon. Member for Sheffield, Hillsborough (Mr. Flannery) to visit them, and they would take great pleasure in extending his education.

Mr. Mark Fisher: It is extremely interesting to speak after the hon. Member for


Surbiton (Mr. Tracey). Hon. Members will appreciate the quality of advice that the Independent Schools Association is receiving, and they can judge for themselves the desperate straits that the schools must be in if they need that quality of advice and feel that they can profit from the educational experience and skill of the hon. Member for Surbiton.
My hon. Friend the Member for Sheffield, Hillsborough (Mr. Flannery) and I have taught on wet Wednesday afternoons more unruly classes than the one now before us that have benefited from what we said. I trust that Conservative Members will also benefit from what we have to say.
Regulations 3, 4, 5 and 6 widen the scope of the provisions, which I and my hon. Friends regret. We would prefer the regulations to be diminished to zero, because they are an attempt to catch more children. I consider the regulations to be selective rather than comprehensive. Once we go down the road of selection, we are assessing criteria and trying to decide which children should qualify for one or other forms of education. We are dealing not with standards, but with prejudice in assessing the criteria to be used. The Opposition hold as a basic tenet of education and faith that all children should have a universal standard of education and that nothing else is acceptable.
For Conservative Members to consider providing different standards of education for different children is nonsense and an aberration. If they reflected upon the matter without their political prejudice, they would realise that different standards of education are not in the interests of children.
Regulations 3, 4, 5 and 6, by widening the scope of the provisions, are taking us down the wrong road. Similarly we must ask whether the regulations improve the quality of education. Nothing said by the Minister or any Conservative Member gives any substance to their argument. How do the regulations improve the quality of education for all children so that the country is a wiser and better educated place? Nothing said by any Conservative Member has substantiated that view. The scheme is nothing but a subsidy for the private schools that does nothing to improve the overall quality of education in Britain. Surely, as the legislative body for this country, our main objective should be to improve the quality of education for the whole of the country.
Regulation 6 increases the financial provision for the scheme. As my hon. Friends the Members for Denton and Reddish (Mr. Bennett) and for Hillsborough and the hon. Member for Cambridgeshire, North-East (Mr. Freud) said, that £55 million could be better spent elsewhere.
Before Christmas many hon. Members present tonight debated the Education (Grants and Awards) Bill, which will impose a tax of 0·5 per cent. on the spending of local authorities on education. The financial provisions of the regulations could be used to prevent that tithe on local authorities, and experimentation in curriculum and new ideas could be financed.

Mr. David Model: It is not a tithe but a redistribution of spending on education. The hon. Gentleman misunderstood the Bill.

Mr. Fisher: We are not here to debate that Bill again. However, the hon. Gentleman is incorrect. All authorities

will have to give up a percentage of their education grant to central Government, who will redistribute it to the schemes of which they approve.
The important point is that we are talking about £55 million of taxpayers' money which could be better spent elsewhere in the education service. Many of the areas of concern about which hon. Members spoke in debate last Friday could be financed by that £55 million. The country would be better off as a country and an educational culture if it was spent in that way. The schemes suggested by Opposition Memers and also those mentioned by the Secretary of State in his speech at Sheffield could be financed by that £55 million. Regulation 6 is not in the interests of the children.
Nothing that I have said has been refuted by the Minister or Conservative Members. The widening of the scheme in regulations 3, 4, 5 and 6 and the financial provisions in regulation 6 are against the interests of the education service in Britain, which is what we should be debating, and that is why the Opposition wholly oppose the regulations.

Mr. Patrick Thompson: During my brief speech I shall seek to argue that the regulations should be passed so that the assisted places scheme can continue to operate successfully.
I have some relevant personal experience of the scheme which I wish briefly to mention. I have been involved with the selection, interviewing and teaching of pupils on an assisted places scheme. I happen to believe, as a result of that personal experience, that if the Opposition would think of education being about people rather than a political argument or dogma such as the House has heard in the debate, and if they could see the individual boys and girls who have benefited from the assisted places scheme, they would be as enthusiastic as Conservative Members are about it.
The scheme works, it is successful and it should continue. Pupils benefit because they have the chance to go to a particular school which runs a course in, for example, music or physics, and provides a good opportunity for the individual. The independent school has benefits because of the wider range of pupils within the school. I am sure that the majority of Opposition Members, if they thought for one moment about the issues involved, would approve of that wider range of pupils within an independent school.
The majority of people in the country and, I am sure, the majority of hon. Members, believe that the independent sector should have the right and freedom to continue to exist. I think that there are very few people who seriously wish to destroy that system. For years people have looked for channels of communication between the state and the independent sector, against opposition from both sides of that divide. I believe that it is beneficial to open up channels of communication between the state and the independent sector. Opposition Members will surely agree with that concept. The assisted places scheme, although small, is a contribution in that direction. It is popular, its cost to the state is negligible, and it is beneficial to the schools involved. The regulations must be passed, because to discontinue this excellent scheme would be negative and would achieve nothing, just as to attack the independent sector is negative, destructive and achieves nothing.
My hopes in education, which I am sure are shared by Opposition Members, are for a high quality, well-supported, maintained system with the freedom for the independent sector to flourish and be supportive. In order to continue to address ourselves to the important matters in education, such as high standards in classroom teaching, an improved curriculum, better training, in-service training for teachers and increased parental choice, such as the assisted places scheme provides, we must pass the regulations. Although the assisted places scheme affects a small number of pupils and schools at a cost of some £16 million, it is consistent with the overall aims and can only enhance and encourage the high standards in education for which Conservative Members are working and campaigning. That is why we support the recent statement of policy by my right hon. Friend the Secretary of State for Education and Science.
The House must pass the regulations in order to continue to support the assisted places scheme. The scheme is contributing to a better flow of information and communications between the two parts of the education service, and is helping individual pupils. To destroy it would do no good for anyone.

Mr. Harry Greenway: I support the regulations because, in my experience, those who will profit are the children, who are what the debate is about. Children have hardly been mentioned. The regulations will broaden opportunities for children to go to a different kind of school from the restricted type of secondary school envisaged by the Labour party. That is to the benefit of the children and of the education system.
I have a constituent who needs to benefit from regulation 6. He is not well paid. He has two children profiting from the assisted places scheme. They are doing extremely well and he is happy, but his income is low and the revised figures will help him considerably to make the small contribution that he has to make. He rightly says that the Labour party's view about the scheme is totally vindictive, and the fact that it is vindictive has been made clear by Opposition Members in the debate.
I mentioned that my constituent would benefit from the regulations. He states that the argument of Labour Members that they would, given the opportunity, put a stop to the scheme tomorrow and cast the children on the streets, so to speak, is totally vindictive. That fact is not lost on my constituent, who is a hard-working member of the community and who is merely seeking to improve the opportunities available to his children.
I look back over my long experience in teaching and recall the damage that the Labour party did to children through its reorganisation scheme. It is clear that its attitude towards this scheme and the regulations is typical of its attitude to education. [Interruption.] The hon. Member for Sheffild, Hillsborough (Mr. Flannery) is a personal friend of mine, but, when he said that he lived in a school, I thought that he was about to say that he lived in a shoe. I am surprised that he would withdraw the scheme and thereby damage the opportunities of children. I ask Labour Members to think again about their attitude to the regulations. The fact that 13,000 children benefit from the scheme and that more will benefit as a result of the regulations must be to the benefit of children.
The hon. Member for Denton and Reddish (Mr. Bennett) said that three children taken out of a

comprehensive—because they would benefit from these regulations—would so damage that comprehensive as to make it and the children in it suffer seriously. That comment was insulting to the teachers at that school. I say that as one who worked for 23 years in comprehensives, and the hon. Gentleman knows that what I am saying is right.
Regulations 4, 5 and 6 carry the assisted places scheme forward at a vital time. They will lead to a broadening of opportunities for children. Labour Members say that not every child in the land will get on in the assisted places scheme as a result of the regulations. They should accept that every child will at least have the opportunity to try. That must be what life is about—about providing people with opportunities — and the late Iain Macleod put it well when he said that the purpose of the state in education was to give people an equal opportunity to prove themselves unequal. That put the ethic of the state in education — whether in the assisted places scheme as revised by these regulations or in maintained schools— in perspective. Equality does not achieve the same purpose in education, and I urge Opposition Members to reconsider their attitude to the scheme because it is for poor children. To keep knocking it is to damage the chances of poor children.

Mr. Dunn: With the leave of the House, Mr. Deputy Speaker, I shall reply to our short debate. My hon. Friends will understand me when I say that the debate has followed traditional lines. I am always pleased to have the involvement of the hon. Member for Sheffield, Hillsborough (Mr. Flannery) in these debates, because he brings a robust, but wrong, view to them.
My hon. Friend the Member for Erith and Crayford (Mr. Evennett) made an excellent speech in which he got the tone of the regulations right. I was delighted to hear such a robust voice. He pointed out that the Labour party would say that there was a cost to the nation from the scheme, and we accept that. There is also an enormous benefit to the nation—many bright and gifted children from ordinary families are given the opportunity to experience an educational opportunity that would otherwise be denied to them.
The Labour party does not understand the lessons of history. On occasions, I have reminded the House that I understand the nature of state education, because, unlike many Opposition Members, I have had no other experience except that which the state offers.

Mr. Deputy Speaker: Order. The Minister has heard me reproach a number of hon. Gentlemen for straying from the regulations and discussing the principles of the scheme. I hope that he will address himself to the regulations.

Mr. Dunn: I apologise for being slightly deaf in my left ear, Mr. Deputy Speaker.
My hon. Friend the Member for Rugby and Kenilworth (Mr. Pawsey) gently chided the Government for not providing more places under the scheme — that point was echoed by a number of my hon. Friends, although by no Opposition Members. However, no resources are available to expand the scheme. If resources became available, there would be some expansion. In the meantime, we have to concentrate on improving the match


of supply with demand, as we have been doing this year with the marginal redeployment of places from those schools that have not taken them up to those schools that wish to take them up. I welcome the inclusion of Westminster school, which was mentioned by my hon. Friend the Member for Surbiton (Mr. Tracey), and that of other schools.
As I said earlier, the safeguard about the veto, which was removed over a year ago from the local education authorities, remains that of limiting to five in any one year the number of children who can enter a sixth form. It would take the fantasising minds of some Opposition Members to argue that such a number would radically dilute the maintained sector. It clearly would not. The House will welcome the information that across the country fewer than 200 pupils last year transferred at sixth form level—

It being one and a half hours after the commencement of proceedings on the motion, Mr. Deputy Speaker put the Question pursuant to Standing Order No. 3 (Exempted business):—

The House divided: Ayes 179, Noes 86.

Division No. 137]
[11.53 pm


AYES


Alexander, Richard
Edwards, Rt Hon N. (P'broke)


Amess, David
Eggar, Tim


Ashby, David
Emery, Sir Peter


Aspinwall, Jack
Evennett, David


Atkinson, David (B'm'th E)
Eyre, Sir Reginald


Baker, Nicholas (N Dorset)
Fallon, Michael


Baldry, Anthony
Farr, John


Batiste, Spencer
Favell, Anthony


Beaumont-Dark, Anthony
Fenner, Mrs Peggy


Bellingham, Henry
Forsyth, Michael (Stirling)


Benyon, William
Forth, Eric


Berry, Sir Anthony
Fraser, Peter (Angus East)


Bevan, David Gilroy
Freeman, Roger


Biffen, Rt Hon John
Gale, Roger


Biggs-Davison, Sir John
Galley, Roy


Blaker, Rt Hon Sir Peter
Garel-Jones, Tristan


Boscawen, Hon Robert
Goodlad, Alastair


Bowden, A. (Brighton K'to'n)
Gow, Ian


Bowden, Gerald (Dulwich)
Greenway, Harry


Brandon-Bravo, Martin
Gregory, Conal


Bright, Graham
Griffiths, Peter (Portsm'th N)


Brinton, Tim
Ground, Patrick


Brooke, Hon Peter
Hamilton, Hon A. (Epsom)


Bruinvels, Peter
Hamilton, Neil (Tatton)


Buck, Sir Antony
Hampson, Dr Keith


Bulmer, Esmond
Hanley, Jeremy


Burt, Alistair
Hargreaves, Kenneth


Butcher, John
Harris, David


Butterfill, John
Harvey, Robert


Carlisle, John (N Luton)
Hawkins, C. (High Peak)


Carlisle, Kenneth (Lincoln)
Hawksley, Warren


Carttiss, Michael
Hayes, J.


Channon, Rt Hon Paul
Hayward, Robert


Churchill, W. S.
Heathcoat-Amory, David


Clark, Hon A. (Plym'th S'n)
Hickmet, Richard


Clark, Dr Michael (Rochford)
Hind, Kenneth


Clarke, Kenneth (Rushcliffe)
Hirst, Michael


Cockeram, Eric
Hogg, Hon Douglas (Gr'th'm)


Colvin, Michael
Holt, Richard


Coombs, Simon
Howarth, Alan (Stratf'd-on-A)


Cope, John
Howarth, Gerald (Cannock)


Couchman, James
Hubbard-Miles, Peter


Cranborne, Viscount
Hunt, David (Wirral)


Currie, Mrs Edwina
Hurd, Rt Hon Douglas


Dorrell, Stephen
Jackson, Robert


Douglas-Hamilton, Lord J.
Jones, Gwilym (Cardiff N)


Dover, Denshore
Jones, Robert (W Herts)


Dunn, Robert
Key, Robert





King, Rt Hon Tom
Nicholls, Patrick


Knight, Gregory (Derby N)
Norris, Steven


Knowles, Michael
Onslow, Cranley


Lang, Ian
Oppenheim, Philip


Latham, Michael
Osborn, Sir John


Lawler, Geoffrey
Ottaway, Richard


Leigh, Edward (Gainsbor'gh)
Page, Richard (Herts SW)


Lester, Jim
Parris, Matthew


Lightbown, David
Pawsey, James


Lilley, Peter
Peacock, Mrs Elizabeth


Lloyd, Ian (Havant)
Porter, Barry


Lloyd, Peter, (Fareham)
Powell, William (Corby)


Lord, Michael
Powley, John


Lyell, Nicholas
Prentice, Rt Hon Reg


McCurley, Mrs Anna
Proctor, K. Harvey


Macfarlane, Neil
Raffan, Keith


MacGregor, John
Rhodes James, Robert


MacKay, Andrew (Berkshire)
Ridsdale, Sir Julian


Maclean, David John.
Rowe, Andrew


Madel, David
Ryder, Richard


Malins, Humfrey
Sackville, Hon Thomas


Malone, Gerald
Sainsbury, Hon Timothy


Maples, John
Skeet, T. H. H.


Marland, Paul
Smith, Sir Dudley (Warwick)


Marlow, Antony
Speed, Keith


Mates, Michael
Stevens, Lewis (Nuneaton)


Mather, Carol
Stewart, Andrew (Sherwood)


Maude, Francis
Thomas, Rt Hon Peter


Maxwell-Hyslop, Robin
Thompson, Donald (Calder V)


Mayhew, Sir Patrick
Thompson, Patrick (N'ich N)


Merchant, Piers
Townend, John (Bridlington)


Meyer, Sir Anthony
Tracey, Richard


Miller, Hal (B'grove)
Trippier, David


Mills, lain (Meriden)
van Straubenzee, Sir W.


Mitchell, David (NW Hants)
Wakeham, Rt Hon John


Moate, Roger
Walden, George


Moore, John
Warren, Kenneth


Morris, M. (N'hampton, S)
Wheeler, John


Morrison, Hon P. (Chester)
Wood, Timothy


Moynihan, Hon C.



Murphy, Christopher
Tellers for the Ayes:


Neale, Gerrard
Mr. Michael Neubert and


Nelson, Anthony
Mr. John Major.


Newton, Tony





NOES


Alton, David
Freud, Clement


Beckett, Mrs Margaret
Godman, Dr Norman


Beith, A. J.
Harrison, Rt Hon Walter


Bennett, A. (Dent'n &amp; Red'sh)
Haynes, Frank


Bermingham, Gerald
Hogg, N. (C'nauld &amp; Kilsyth)


Blair, Anthony
Home Robertson, John


Brown, Gordon (D'f'mline E)
Howells, Geraint


Brown, N. (N'c'tle-u-Tyne E)
Hughes, Sean (Knowsley S)


Callaghan, Jim (Heyw'd &amp; M)
Kirkwood, Archibald


Canavan, Dennis
Lewis, Terence (Worsley)


Carlile, Alexander (Montg'y)
Litherland, Robert


Clay, Robert
Lloyd, Tony (Stretford)


Cocks, Rt Hon M. (Bristol S.)
Loyden, Edward


Cohen, Harry
McDonald, Dr Oonagh


Concannon, Rt Hon J. D.
McKay, Allen (Penistone)


Cook, Frank (Stockton North)
Mackenzie, Rt Hon Gregor


Cook, Robin F. (Livingston)
McNamara, Kevin


Cowans, Harry
Madden, Max


Craigen, J. M.
Marek, Dr John


Cunliffe, Lawrence
Maxton, John


Cunningham, Dr John
Meadowcroft, Michael


Davies, Ronald (Caerphilly)
Michie, William


Davis, Terry (B'ham, H'ge H'l)
Mikardo, Ian


Deakins, Eric
Nellist, David


Dormand, Jack
O'Neill, Martin


Douglas, Dick
Park, George


Dunwoody, Hon Mrs G.
Parry, Robert


Eastham, Ken
Patchett, Terry


Ellis, Raymond
Pike, Peter


Evans, John (St. Helens N)
Powell, Raymond (Ogmore)


Fatchett, Derek
Prescott, John


Field, Frank (Birkenhead)
Radice, Giles


Fisher, Mark
Randall, Stuart


Flannery, Martin
Redmond, M.






Rooker, J. W.
Thomas, Dafydd (Merioneth)


Ross, Stephen (Isle of Wight)
Thompson, J. (Wansbeck)


Rowlands, Ted
Wallace, James


Sheerman, Barry
Wardell, Gareth (Gower)


Skinner, Dennis
Wareing. Robert


Smith, C.(Isl'ton S &amp; F'bury)
Welsh, Michael


Smith, Rt Hon J. (M'kl'ds E)
Winnick, David


Soley, Clive



Spearing, Nigel
Tellers for the Noes:


Stott, Roger
Mr. John McWilliam and


Strang. Gavin
Mr. Don Dixon.

Question accordingly agreed to.

Resolved,
That the draft Education (Assisted Places) (Amendment) Regulations 1984, which were laid before this House on 16th January, be approved.

Tax Office, Matlock

Motion made, and Question proposed, That this House do now adjourn.— [Mr. Boscawen.]

Mr. Matthew Parris: I am grateful, Mr. Deputy Speaker, for this opportunity to raise on the Adjournment the question of the closure of the Matlock tax office. I am grateful because it allows me to raise in what I hope is good time something which I should have raised with my hon. Friend the Financial Secretary to the Treasury some time ago.
I think that it was in April 1983 that my hon. Friend first announced that he was carrying out a general review of all the tax offices in the country. We knew then that Matlock was one of the districts that would be reviewed. I should have been beating at his door and collecting petitions in April. I should have visited the tax office then. That was the time to do it, but I had no idea how important the tax office was to my constituents and constituency. That occurred to me only at a much later stage last year, when my hon. Friend announced in October, in answer to one of my questions, that he was proposing to close the Matlock tax office.
I was taken by surprise at the weight of public opinion and the enthusiasm with which my constituents started to visit me, to write to me and to raise petitions to try to prevent the closure of the tax office. I had under-reacted, and I hope that it is not too late to set the record straight. I have received scores of letters from my constituents. I have received a petition bearing nearly 2,000 signatures. It was raised by those who work at the tax office and by many others in the town, who have collected signatures. I have had letters from numerous parish councils. I have received letters from the Matlock town council, the Bakewell town council and from the chambers of trade. I have had letters from many accountants in my constituency. I have had a letter from the county council underlining its grave anxiety that Matlock, which is the county seat and the place where the county council is situated, should cease to have its own tax office. I have received five delegations from the staff of the office.
Not long ago I went to visit the office at the staff's invitation. I felt sad that I should be visiting for the first time such a friendly and efficient place and meeting for the first time such courteous and helpful people only because the threat of closure hung over their heads. It made me realise that I should have visited them a long time ago before any such threat was there.
I have mentioned the staff, but I do not wish to say much more about them. There are about 40 people working at the office and they have a direct interest in the maintenance of the tax office in Matlock. It is obvious that they do not want it transferred or merged with the Alfreton office. That interest and the conditions of the merger, should it take place, are best left for them to discuss with their staff federation. I am not here to argue that the tax office should stay open for the benefit of those who work there. Most of them are women and not many of them have their own independent transport. Most of them live in the vicinity and many of them depend on walking or upon public transport. The offer of an alternative job somewhere outside Matlock must be an offer in name only. It cannot mean much to many of them, and it would mean the end


of many of their careers. However, they do not pose the problem which I really wish to raise with my hon. Friend. It is the customers about whom I wish to talk.
If I describe the geography of the area, it will be rather more real than merely looking at it on the map. On the map, Alfreton is not very far from Matlock, and neither is Chesterfield. It is hilly and fairly wild country. At the moment it is deep in snow and many roads are closed. It would not surprise me if the roads between Matlock and Chesterfield were shut or if it were impossible to travel from Matlock to Alfreton. It is an area in which public transport is infrequent, unreliable and expensive. The 50 miles from Stockport on the Manchester side to Alfreton on the east Derbyshire side—which will be the gap between tax offices when those at Matlock and Buxton are closed — will be an area within which it will be inconvenient to live should one need to call in person at the tax office. It is obviously those people who need to call in person whose inconvenience must concern us. Those who want to deal with matters by telephone or correspondence can probably do so as well at one tax office as at another.
From the correspondence that I have received it appears that those who need to go to the tax office in person fall into two categories. The first category comprises the self-employed and small business people. The self-employed must call every three years for their certificates, but often they must call more frequently. A self-employed or small business man paying tax is not in the same position as a person on PAYE. It can be a complicated business and a matter for negotiation and discussion with Inland Revenue. It can be difficult to conduct that business through an official correspondent. It is much easier to sort things out by going up Bank road to the tax office and having a half-hour chat with the friendly and efficient staff who work there. A great many self-employed people and business men have written to me in those terms.
One letter that I have received from a constituent in Cromford near Matlock states:
Dear Sir,
I operate a very small business but it entails the submission of accounts so that my tax liability can be assessed. Without the friendly, patient explanations given by the staff at Matlock Tax Office I could not have managed to understand 'the system'. My PAYE tax is not dealt with at Matlock but telephone calls are too expensive to make during the day and, to date, any calls made have failed to make me understand the business of appeals. I tried to find out by letter and government pamphlets but they presumed a knowledge I did not have.
All was revealed by the staff at Matlock and without being inconvenienced by long, tedious journeys.
I can only say what a tragedy it will be to myself and other local people if this office closes and the service disappears.
Please—think again and keep a tax office open locally. West Derbyshire is a large area. It is an area which needs and deserves such a service. As my MP, please do what you can.
The Matlock tax office is at the eastern end of the area it serves. Inconvenient though it may be for people in Matlock to go to Alfreton or Chesterfield, it will be more inconvenient for people in Bakewell and beyond, who will have even further to go.
Pensioners face problems, and many have written to me. They are the second category of people who find it necessary to go to the tax office. Their tax affairs are often small beer in terms of the public sector borrowing requirement, but they are important to the pensioner concerned. They may also be intricate. The pensioner may

have a small pension or some capital. He may not be up to conducting an official correspondence, may not still drive his car and it may not be easy for him to rely on public transport. For such a person a call at the tax office at Matlock can be by far the easiest, and sometimes the only way of sorting matters out to his satisfaction, and many pensioners have written to me to say so.
There is another matter, which may not find favour with my constituents. I do not wish to enter into the controversy over what Her Majesty the Queen said in her new year's message to the Commonwealth, but she said one thing with which I believe everyone would agree—that it does not matter how intricate and sophisticated our information and computer systems may be, the quality of what comes out of them will depend very much on the quality of what goes into them.
No matter how technological our methods of communication, what we communicate is more important. The advent of computers may revolutionise our tax system, and we may rationalise until the cows come home, but the quality of the decisions made and of the whole tax-gathering process will depend on the quality of the information fed into the system.
Present plans will create a black hole in the Inland Revenue's information system, from Stockport to Alfreton. A local tax inspector who lives, works and travels in the area knows who people are, what is going on and even who drives which car. It takes that kind of knowledge to follow tax affairs properly in an area such as Matlock. No one in Alfreton knows who we are or what we are doing, and my right hon. Friend the Chancellor of the Exchequer may well be the loser if we no longer have tax inspectors familiar with Matlock and Bakewell. I shall say no more about that, however, as that point may not be as welcome to my constituents as others that I have made.
In a debating Chamber in which we talk increasingly about efficiency, rationalisation, cost-effectiveness and cost-benefit, it is not easy to talk about the happy and courteous atmosphere that prevails at the Matlock tax office. Nevertheless, that is indeed the case, as so many of my correspondents testify. It happens to be a particularly efficiently and pleasantly run office, where the staff seem to enjoy the confidence of those whom they serve and where the staff and the inspectors seem to get on particularly well with one another. Local accountants have written to me saying that the reputation of the Matlock office for reliability is much higher than that of any other tax office with which they deal. It works particularly well and there is sometimes an argument for letting such offices continue even when arguments for rationalisation lead in the opposite direction.
I do not suppose that the Conservative philosophy is so easily defined that I can crystallise in a couple of sentences the exact doctrine on which I commended myself to my constituents in the last two elections. Those people have already lost their local electricity and gas headquarters and their local hospital. We fear that the maternity hospital, too, will soon be lost. Much of our rail service and some of our bus services have gone. Now it seems that our tax office, too, is to go. I do not think that my constituents regard that as the kind of Conservatism on which I based my two election campaigns. It is certainly not my idea of Conservatism or of what the Government are about.
For that reason, I hope that my hon. Friend the Minister will reconsider his plans very carefully. If he then still takes the view that they cannot be changed and that closure


is the only way forward, although I question whether it could be a way forward for Matlock, I make this final plea. It is very difficult not just for customers but especially for the staff of the office to live in constant uncertainty about the future. They have heard that closure may come at any time between 1984 and 1987. It is hard for those people to plan their careers and the rest of their working lives on the basis of such an imprecise prediction. We should all be most grateful for firmer assurances from my hon. Friend. We hope that the office will not be closed, but if the decision has to stand we need more precise information about when and how it will be implemented.
I am very grateful to my hon. Friend for sitting up so late to listen to me and I am sure that my gratitude is shared by everyone in the tax office at Matlock.

The Financial Secretary to the Treasury (Mr. John Moore): I congratulate my hon. Friend the Member for Derbyshire, West (Mr. Parris) not only on having had the opportunity to raise this matter but on the manner in which he has raised an issue which is clearly of importance to his constituency. He is over-modest about the assiduous way in which he pursues the interests of his constituents. I am genuinely grateful to him for setting out the arguments so clearly. I shall try to reply in a similar fashion and to explain the background to the closures as well as the particular circumstances of Matlock.
In 1982 as my hon. Friend said, an Inland Revenue committee completed a review of the organisation of the local tax district network. It reported on the principles which should decide the size, and hence the number, of the offices. The report was part of a more general review of the work of inspectors of taxes, the aim of which was to help the Department to make the most effective use of these highly-trained staff.
As a first step, the Department used the principles recommended by the committee to prepare an outline plan for reorganising the tax district network. This was announced to the House as my hon. Friend said, in April 1983, and a copy of the Inland Revenue report was placed in the Library together with a note on the reorganisation proposals. At the same time, the Department issued a press release. The Department also circulated details of the proposals to staff and their union representatives to enable them to consider the plans and make representations.
In a relatively small number of cases, the proposals involved the closure of the only tax district in a town, Matlock being an example. Recognising the particular difficulties which these towns and their communities might face—admirably described by my hon. Friend—my predecessor wrote in April to each of the hon. Members representing those towns, to alert them to the plans.
Generally the arrangements that I have described served their purpose, and the Department was able to consider the views of hon. Members, other interested parties and staff in coming to final decisions. This consultative process lasted some six months and it was not until late October that the final plans were announced. I think that the House will agree that Ministers and the Department did all that could reasonably be expected to bring the proposals to the attention of interested parties and to allow sufficient time for consultation. It would simply not have been feasible to contact individually all those who might have an interest in the matter to bring the proposals to their attention. It is

regrettable that the proposals do not seem to have been widely known to local authorities and professional bodies in the Matlock area until a late stage, although I understand that the proposals announced in April received considerable coverage in the local press.
Implementation of the final plans will mean that 164 offices will close out of a total of 765. As well as enabling the more efficient and effective use of existing staff resources—in particular trained inspectors—which is the prime purpose of the exercise, the implementation will provide significant savings in the cost of accommodation and administration generally.
The more effective use of inspector resources will come out in various fields. For example, a large number of fully trained inspectors will be released from management duties for redeployment in areas where it has already been shown, as my hon. Friend said that they will be more cost-effective. I am afraid that it is not possible to translate this move towards greater effectiveness and efficiency into some kind of profit and loss account with quantifiable financial savings.
As regards accommodation savings, the Department is completing a detailed review of four of its 15 regions. This shows that, in those four regions, there is every prospect of making savings of at least £2 million per annum, with the possibility of additional further savings of around the same amount in due course. I should stress that the reorganisation plans are not a staff-cutting exercise. The intention is to make better use of existing resources.
The closures will come mainly in cities and towns where there is at present more than one tax district. For example, Birmingham which now has 21 districts will be reorganised into 10 offices. However, the plans also mean that 23 towns, including Matlock, will lose their only tax office.
Where the proposals involve the closure of the only tax district in a town, the Department recognised from the beginning that factors other than efficiency and savings had to be taken into account. In particular, loss of access, the effect on the community generally and on the staff of the offices were of considerable importance. A difficult balance had to be struck. After careful consideration, the Department decided that of the 39 towns scheduled to lose their tax office under the outline proposals announced in April, 16 should in fact retain the office. I think that this shows the Department's willingness to listen to representations and to revise its decision if the arguments are of sufficient weight.
Turning now to Matlock in particular, the plan is to merge the tax districts in Matlock and Alfreton. Both districts are well below the minimum recommended size whereas the merged district will be of the optimum size if the best use of staff is to be achieved. There were two reasons for choosing Alfreton as the location of the merged office. First, it is larger and deals with more taxpayers. Secondly, it will enable the Department to give up leased premises in Matlock and to utilise more fully the existing Crown building in Alfreton. Apart from the accommodation savings, there will be a reduction in overheads and attendant costs.
Matlock is eight miles — and, as my hon. Friend stressed, eight difficult miles—away from Alfreton and I should not seek to deny that closure will have some unwelcome effects. The main such effect will as he says, of course be the difficulty which taxpayers will face in visiting the office in Alfreton. In saying that, I recognise


that some of my hon. Friend's constituents, for example, in the Bakewell area already have some problems in visiting Matlock and that these will be made worse by the move to Alfreton. For some taxpayers the problem is more acute than for others.
I am well aware as my hon. Friend stressed that many pensioners, for example, find it hard to understand all aspects of their tax affairs and that for some personal contact is often the best, if not the only, way in which they can come to grips with the matter. The self-employed, as he again stressed, while in many cases represented by professional advisers, often need to visit their tax office. Subcontractors are required to visit their tax office, admittedly only every three years, to collect or review their exemption certificate. It is perhaps as well to remember, however, that dealing with personal callers represents a small part of the work of a tax officer. Far and away the main means of communication are telephone calls and letters.
The Department does not keep a record of the number of visits made by taxpayers to the Office in Matlock, nor to other local tax offices. We are aware that a considerable number of visits are made. However in coming to a view on the inconvenience which will flow from the closure, knowing the specific number is of relatively limited value. What is important is the degree of difficulty and expense to which taxpayers, whatever the precise number, will be put in having to travel to Alfreton. I assure the house and my hon. Friend that these problems were carefully considered. I should emphasise that this was not an armchair exercise carried out in London. The Department's regional managers, based in Sheffield. were closely involved in evaluating the difficulties of access. Those managers were well aware of the geographical characteristics of the area and of the public transport facilities available.
All those points were weighed against the arguments of increased operational efficiency and savings which pointed to closure. It was not an easy matter but the Department concluded, on balance, that the arguments for closure should prevail. The Department is very conscious of the feelings which this decision has aroused, as evidence by the petition to which my honourable Friend referred. It is also full aware of the high reputation which the present Matlock office has for efficiency and courtesy. I welcome the generous tribute paid to the staff by my hon. Friend. It is true that the Department will not be able to offer the same service to the public, if one thinks solely in terms of the location of the tax distric. However, in all other respects it is the Department's intention that the present high level of service should be maintained and, if possible, improved. In saying this I recognise the force of my honourable Friend's arguments, and I do not seek to dispute the merits of the points that he has made. Rather. I differ on the relative weight to be attached to them.
Difficulties of access are also of relevance to the ability of tax district staff, particularly inspectors, to carry out their duties. The need for local access and knowledge was specifically considered in the Inland Revenue report, from

which these reorganisation plans flow. In some areas of work it is of vital importance, and therefore the reorganisation plans seek to retain it. The element of centralisation is very limited. In the case of Matlock and Alfreton, we are talking about the merger of two small offices, with the merged office still in Alfreton eight miles away from Matlock. Looking at the plans as a whole, even after completion the Department will have a local district network of about 600 offices.
Another unwelcome effect of closure will be inconvenience to staff whose place of work will change. Many will face significantly longer journeys; and staff rightly made represenations on this point. Again these were considered by the Department's regional managers and were also discussed at central level with trade union representatives. Again the Department, while recognising the difficulties, did not consider them to be such as to outweigh the advantages of closure.
My hon. Friend rightly asked me to address myself particularly to the current uncertainty. The Department is now discussing with staff how they can be redeployed in Alfreton or other offices in the area, taking into account, wherever possible, their wishes. More generally, the Department is in discussion with the trade union concerned to set up a joint committee to oversee the personnel consequences of the reorganisation programme.
The exact timetable for the merger of the offices has not been fully worked out as yet. However, it is probable, as matters stand at present, that the closure of Matlock will take place towards the end of 1985. The closure cannot be left any later because of the Department's plans to computerise PAYE, which, as my hon. Friend said, is a major reform, which is scheduled to take place during 1986 in that part of the country. The merger must precede computerisation if considerable abortive expenditure is to be avoided.
My hon. Friend drew to the attention of the House several important considerations for Ministers and for the Inland Revenue in operating the tax system. In concluding that there is not scope to alter the decision to close Matlock tax office, I am not seeking in any way to dispute the importance of the points he made so eloquently, but rather I would attach more weight to others. As I have described, proper arrangements were made for representations to be made and consultations were carried out before reaching the decision. I have satisfied myself that during the six months between the announcement of the outline proposals and the taking of final decisions the Department has given due weight to all the arguments. I hope that the House will agree that the cost savings and improved operational efficiency that will result from the closure of some 150 tax offices, including Matlock, will make a worthwhile contribution to the Government's programme of improving the efficiency and cost-effectiveness of the public sector. That is in the interests of all taxpayers. I welcome the way in which my hon. Friend has drawn this matter to the attention of the House.

Question put and agreed to.

Adjourned accordingly at twenty-nine minutes to One o' clock.